ANNUAL REPORT 2014
THE VENETIAN LAS VEGAS
May 1999
SANDS MACAO
May 2004
THE PALAZZO
December 2007
MARINA BAY SANDS
April 2010
CELEBRATING 10 YEARS
H
OF INNOVATION AND GROWTH
F
ellow Shareholders,
I am pleased to present to you our 2014 Annual Report.
2014 was another successful year for the Company as we continued to execute our operating
strategies and fortify our position as the preeminent worldwide developer and operator of
convention-based Integrated Resorts. We delivered another year of industry-leading financial
performance, setting records in net revenue, adjusted property EBITDA, cash flows from
operations, adjusted net income and diluted earnings per share.
The Company returned nearly $3.3 billion of capital to shareholders during 2014 in the form of dividends and stock
repurchases. We remain committed to growing the return of capital to shareholders in the years ahead, and announced a
30% increase in our annual recurring dividend to $2.60 per common share for the 2015 year.
In Macao, we delivered market-leading growth, while meaningfully contributing to Macao’s economic diversification and
development goals. Our property portfolio produced record revenues and cash flows from operations. Strong growth in
non-gaming revenue from our hotel, retail, entertainment and convention businesses, coupled with growth in mass gaming
win, contributed to record financial results and reflect the inherent benefits of our convention-based Integrated Resort
business model.
With the completion of The Parisian Macao and the St. Regis Tower, we will have invested in excess of $13.0 billion in
Macao to deliver on our commitment to its economic diversification and evolution into the world’s leading business and
leisure tourism destination. As one of the largest employers in Macao, we are proud of our meaningful investments in the
training and professional development of our 28,000 Sands China team members.
In Singapore, Marina Bay Sands continued its strong financial performance and remains the most successful convention-
based Integrated Resort in the world. Marina Bay Sands is a must see destination in Asia and has contributed to increasing
business and leisure tourism to Singapore. The success of Marina Bay Sands has allowed it to serve as an important
reference site for emerging jurisdictions that are considering Integrated Resort development.
The benefits of our convention-based Integrated Resort business model extend far beyond our own financial success. The
Company’s properties and service offerings, featuring dining, shopping, convention, group meeting and entertainment
experiences, increase the appeal of our host countries as business and leisure tourism destinations, while helping to
diversify their economies, attract outside investment, and increase employment.
Our Integrated Resort business model could provide meaningful economic benefits in additional countries in Asia.
We believe our unmatched track record of successful Integrated Resort development coupled with our industry-leading
financial strength uniquely position us to secure future development opportunities.
I am proud to highlight the positive impact that the Company and our nearly 50,000 team members have had on the local
communities in which we operate. Through Sands Cares, our corporate citizenship program, we are committed to making
our local communities a better place to live while reducing our environmental impact on the planet.
Thank you for your support and the confidence you continue to show in our Company. We look forward to sharing with
you the ongoing success of the Company in the years ahead.
Sheldon G. Adelson
Chairman and Chief Executive Officer
April 2015
UNITED STATES SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
Form 10-K
ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the fiscal year ended December 31, 2014
or
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 001-32373
LAS VEGAS SANDS CORP.
(Exact name of registrant as specified in its charter)
Nevada
(State or other jurisdiction of
incorporation or organization)
3355 Las Vegas Boulevard South
Las Vegas, Nevada
(Address of principal executive offices)
27-0099920
(IRS Employer
Identification No.)
89109
(Zip Code)
Registrant’s telephone number, including area code:
(702) 414-1000
Securities registered pursuant to Section 12(b) of the Act:
Title of Each Class
Common Stock ($0.001 par value)
Name of Each Exchange on Which Registered
New York Stock Exchange
Securities registered pursuant to Section 12(g) of the Act:
None
Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities
Act. Yes
No
Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the
Act. Yes
No
Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the
Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file
such reports); and (2) has been subject to such filing requirements for the past 90 days. Yes
No
Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every
Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T during the preceding 12 months
(or for such shorter period that the registrant was required to submit and post such files). Yes
No
Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K (§ 229.405 of this chapter)
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.
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a
smaller reporting company. See the definitions of “large accelerated filer,” “accelerated filer” and “smaller reporting company”
in Rule 12b-2 of the Exchange Act. (Check one):
Large accelerated filer
Non-Accelerated filer
(Do not check if a smaller reporting company)
Smaller reporting company
Accelerated filer
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Act). Yes
As of June 30, 2014, the last business day of the registrant’s most recently completed second fiscal quarter, the aggregate
market value of the registrant’s common stock held by non-affiliates of the registrant was $28,447,596,393 based on the closing
sale price on that date as reported on the New York Stock Exchange.
No
The Company had 798,510,417 shares of common stock outstanding as of February 24, 2015.
DOCUMENTS INCORPORATED BY REFERENCE
Description of document
Portions of the definitive Proxy Statement to be used in connection with
the registrant’s 2015 Annual Meeting of Stockholders
Part of the Form 10-K
Part III (Item 10 through Item 14)
Las Vegas Sands Corp.
Table of Contents
PART I
ITEM 1 — BUSINESS .........................................................................................................................
ITEM 1A — RISK FACTORS ................................................................................................................
ITEM 1B — UNRESOLVED STAFF COMMENTS .............................................................................
ITEM 2 — PROPERTIES.....................................................................................................................
ITEM 3 — LEGAL PROCEEDINGS ..................................................................................................
ITEM 4 — MINE SAFETY DISCLOSURES......................................................................................
PART II
ITEM 5 — MARKET FOR REGISTRANT’S COMMON EQUITY, RELATED STOCKHOLDER
MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES..........................
ITEM 6 — SELECTED FINANCIAL DATA ......................................................................................
ITEM 7 — MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
AND RESULTS OF OPERATIONS ................................................................................
ITEM 7A — QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK ....
ITEM 8 — FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA .....................................
ITEM 9 — CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON
ACCOUNTING AND FINANCIAL DISCLOSURE ......................................................
ITEM 9A — CONTROLS AND PROCEDURES ..................................................................................
ITEM 9B — OTHER INFORMATION ..................................................................................................
PART III
ITEM 10 — DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE ...........
ITEM 11 — EXECUTIVE COMPENSATION......................................................................................
ITEM 12 — SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND
MANAGEMENT AND RELATED STOCKHOLDER MATTERS ...............................
ITEM 13 — CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS, AND DIRECTOR
INDEPENDENCE ...........................................................................................................
ITEM 14 — PRINCIPAL ACCOUNTANT FEES AND SERVICES ....................................................
PART IV
ITEM 15 — EXHIBITS AND FINANCIAL STATEMENT SCHEDULES..........................................
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ITEM 1. — BUSINESS
Our Company
PART I
Las Vegas Sands Corp. (“LVSC,” or together with its subsidiaries “we” or the “Company”) is a Fortune 500
company and the leading global developer of destination properties (integrated resorts) that feature premium
accommodations, world-class gaming, entertainment and retail, convention and exhibition facilities, celebrity chef
restaurants and other amenities.
We currently own and operate integrated resorts in Asia and the United States. We believe that our geographic
diversity, best-in-class properties and convention-based business model provide us with the best platform in the
hospitality and gaming industry to continue generating substantial cash flow while simultaneously pursuing new
development opportunities. Our unique convention-based marketing strategy allows us to attract business travelers
during the slower mid-week periods while leisure travelers fill our properties during the weekends. Our convention,
trade show and meeting facilities combined with the on-site amenities offered at our Macao, Singapore and Las Vegas
integrated resort properties provide flexible and expansive space for trade shows, conventions and other meetings.
In addition, our properties are differentiated by our high-end gaming facilities and significant retail offerings.
The Paiza Club located at our properties is an important part of our VIP gaming marketing strategy. Our Paiza Clubs
are exclusive invitation-only clubs available to our premium players that feature high-end services and amenities,
including luxury accommodations, restaurants, lounges and private gaming salons. We also offer players club loyalty
programs at our properties, which provide access to rewards, privileges and members-only events. Additionally, we
believe that being in the retail mall business and, specifically, owning some of the largest retail properties in Asia will
provide meaningful value for us, particularly as the retail market in Asia continues to grow. With the completion of the
remaining phase of Sands Cotai Central, we will own approximately 2.7 million square feet of gross retail space.
Through our 70.1% ownership of Sands China Ltd. (“SCL”), we own and operate a collection of integrated resort
properties in the Macao Special Administrative Region (“Macao”) of the People’s Republic of China (“China”). These
properties include The Venetian Macao Resort Hotel (“The Venetian Macao”), Sands Cotai Central, the Four Seasons
Hotel Macao, Cotai Strip (the “Four Seasons Hotel Macao,” which is managed by Four Seasons Hotels, Inc.) and the
Plaza Casino, which we own and operate (together with the Four Seasons Hotel Macao, the “Four Seasons Macao”)
and the Sands Macao. We have also commenced construction on The Parisian Macao, our latest integrated resort on
Cotai, which is currently anticipated to open in 2016, subject to Macao government approval.
In Singapore, we own and operate the iconic Marina Bay Sands, which has become one of Singapore’s major
tourist, business and retail destinations since its opening in 2010.
Our properties in the United States include The Venetian Resort Hotel Casino (“The Venetian Las Vegas”) and
The Palazzo Resort Hotel Casino (“The Palazzo”), Five-Diamond luxury resorts on the Las Vegas Strip, as well as the
Sands Expo and Convention Center (the “Sands Expo Center”) in Las Vegas, Nevada and the Sands Casino Resort
Bethlehem (the “Sands Bethlehem”) in Bethlehem, Pennsylvania.
We pride ourselves on being an exemplary employer and an upstanding corporate citizen that helps improve the
quality of life for our team members and the communities in which we operate. Through our Sands Cares and other
avenues, we are an active community partner offering assistance to charitable organizations and other worthy causes.
We are also committed to protecting the environment and to being a global leader in sustainable resort development.
Through our Sands ECO360° Global Sustainability program, we develop and implement environmental practices for
our existing and future resort developments to protect our natural resources, offer our team members a safe and healthy
work environment and enhance the resort experiences of our guests.
LVSC was incorporated as a Nevada corporation in August 2004. Our common stock is traded on the New York
Stock Exchange (the “NYSE”) under the symbol “LVS.” Our principal executive office is located at 3355 Las Vegas
Boulevard South, Las Vegas, Nevada 89109 and our telephone number at that address is (702) 414-1000. Our website
address is www.sands.com. The information on our website is not part of this Annual Report on Form 10-K.
3
Our Annual Reports on Form 10-K, Quarterly Reports on Form 10-Q, Current Reports on Form 8-K, proxy
statements and other Securities and Exchange Commission (“SEC”) filings, and any amendments to those reports and
any other filings that we file with or furnish to the SEC under the Securities Exchange Act of 1934 are made available
free of charge on our website as soon as reasonably practicable after they are electronically filed with, or furnished to,
the SEC and are also available at the SEC’s internet site address at www.sec.gov or in the SEC’s Public Reference Room
at 100 F Street, NE, Washington D.C., 20549. Information related to the operation of the SEC’s public reference room
may be obtained by calling the SEC at 1-800-SEC-0330.
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.”
Our principal operating and developmental activities occur in three geographic areas: Macao, Singapore and the
United States. Management reviews the results of operations for each of its operating segments, which generally are
our casino properties. In Macao, our operating segments are: The Venetian Macao; Sands Cotai Central; Four Seasons
Macao; Sands Macao; and Other Asia (comprised primarily of our ferry operations and various other operations that
are ancillary to our properties in Macao). In Singapore, our operating segment is Marina Bay Sands. In the United
States, our operating segments are: The Venetian Las Vegas, which includes the Sands Expo Center; The Palazzo; and
Sands Bethlehem. The Venetian Las Vegas and The Palazzo operating segments are managed as a single integrated
resort and have been aggregated as one reportable segment (the “Las Vegas Operating Properties”), considering their
similar economic characteristics, types of customers, types of services and products, the regulatory business environment
of the operations within each segment and our organizational and management reporting structure. Management also
reviews construction and development activities for each of its primary projects under development, in addition to its
reportable segments noted above. See “Item 7 — Management Discussion and Analysis of Financial Condition and
Results of Operations — Development Projects.” Our primary projects under development are The Parisian Macao,
the St. Regis tower ( the remaining phase of Sands Cotai Central) and the Four Seasons apart-hotel tower in Macao,
and our Las Vegas condominium project (which construction currently is suspended) in the United States. See “Item 8
— Financial Statements and Supplementary Data — Notes to Consolidated Financial Statements — Note 17 — Segment
Information.”
Asia Operations
Macao
The Venetian Macao is the anchor property of our Cotai Strip development and is conveniently located
approximately two miles from Macao’s Taipa Temporary Ferry Terminal on Macao’s Taipa Island. The Venetian Macao
includes approximately 376,000 square feet of gaming space with approximately 590 table games and 2,080 slot
machines. The Venetian Macao features a 39-floor luxury hotel tower with over 2,900 elegantly appointed luxury suites
and the Shoppes at Venetian, approximately 925,000 square feet of unique retail shopping with more than 330 stores
featuring many international brands and home to more than 50 restaurants and food outlets featuring an international
assortment of cuisines. In addition, The Venetian Macao has approximately 1.2 million square feet of convention
facilities and meeting room space, a 1,800-seat theater, the 15,000-seat CotaiArena that hosts world-class entertainment
and sporting events and a Paiza Club.
Sands Cotai Central is located across the street from The Venetian Macao and Four Seasons Macao and is our
largest integrated resort on the Cotai Strip. We opened the Conrad and Holiday Inn tower and the first Sheraton tower,
in April and September 2012, respectively, and the second Sheraton tower in January 2013. The property includes
approximately 370,000 square feet of gaming space with approximately 510 table games and 1,700 slot machines. We
have begun construction of the remaining phase of the project, which includes the St. Regis hotel and mixed-use tower.
Upon completion, Sands Cotai Central will consist of a 13.7 million-square-foot 6,400-room integrated resort complex
featuring rooms, suites and apart-hotel units, approximately 800,000 square feet of retail, entertainment and dining
space, over 550,000 square feet of meeting facilities and a multipurpose theater (to open in mid-2015).
The Four Seasons Macao, which is located adjacent to The Venetian Macao, has approximately 105,000 square
feet of gaming space with approximately 140 table games and 150 slot machines at its Plaza Casino. The Four Seasons
Macao also has 360 elegantly appointed rooms and suites; several food and beverage offerings; and conference and
4
banquet facilities. The Shoppes at Four Seasons includes approximately 258,000 square feet of retail space and is
connected to the Shoppes at Venetian. The Four Seasons Macao also features 19 ultra-exclusive Paiza Mansions, which
are individually designed and made available by invitation only.
The Sands Macao, the first U.S. operated Las Vegas-style casino in Macao, is situated near the Macao-Hong
Kong Ferry Terminal on a waterfront parcel centrally located between Macao’s Gongbei border gate with China and
Macao’s central business district. The Sands Macao includes approximately 241,000 square feet of gaming space with
approximately 270 table games and 910 slot machines. The Sands Macao also includes a 289-suite hotel tower, spa
facilities, several restaurants and entertainment areas, and a Paiza Club.
We operate the gaming areas within our Macao properties pursuant to a 20-year gaming subconcession that expires
in June 2022. See “— Regulation and Licensing — Macao Concession and Our Subconcession.”
Singapore
Marina Bay Sands features approximately 2,600 rooms and suites located in three 55-story hotel towers. Atop
the three towers is the Sands SkyPark, an extensive outdoor recreation area with a 150-meter infinity swimming pool
and several dining options. The integrated resort offers approximately 160,000 square feet of gaming space with
approximately 600 table games and 2,500 slot machines; The Shoppes at Marina Bay Sands, an enclosed retail, dining
and entertainment complex with signature restaurants from world-renowned chefs; an event plaza and promenade; and
an art/science museum. Marina Bay Sands also includes approximately 1.2 million square feet of meeting and convention
space and two state-of-the-art theaters for top Broadway shows, concerts and gala events.
Asia Markets
Macao
Macao is the largest gaming market in the world and the only market in China to offer legalized casino gaming.
According to Macao government statistics that are issued publicly on a monthly basis by the Gaming Inspection and
Coordination Bureau (commonly referred to as the "DICJ"), annual gaming revenues were $44.1 billion in 2014, a
2.6% decrease over 2013.
We expect that Macao will continue to experience meaningful long-term growth and the record 31.5 million
visitors that Macao welcomed in 2014 will continue to increase. We believe this growth will be driven by a variety of
factors, including the movement of Chinese citizens to urban centers in China, continued growth of the Chinese outbound
tourism market, the increased utilization of existing transportation infrastructure, the introduction of new transportation
infrastructure and the upcoming increase in hotel room inventory in Macao and neighboring Hengqin Island. Based on
announced plans in Macao, over $22 billion of capital is expected to be invested by concessionaires and
subconcessionaires in new resort development projects on Cotai with announced opening dates between 2015 and 2017.
This includes our investments in The Parisian Macao and the St. Regis tower at Sands Cotai Central. In total, these
new projects will add over 12,000 incremental hotel rooms, along with other non-gaming offerings and gaming capacity.
These new resorts should help increase the critical mass on Cotai and further drive Macao’s transformation into a
leading business and leisure tourism hub in Asia.
Table games are the dominant form of gaming in Asia, with Baccarat being the most popular game. With the
increase in the mass gaming market over the past few years, we have seen a significant increase in slot machine play
and expect this business to continue to grow in Macao. We intend to continue to introduce more modern and popular
products that appeal to the Asian marketplace and believe that our high-quality gaming product has enabled us to capture
a meaningful share of the overall Macao gaming market across all player segments.
Proximity to Major Asian Cities
More than 1.0 billion people are estimated to live within a three-hour flight from Macao and more than 3.0 billion
people are estimated to live within a five-hour flight from Macao.
Visitors from Hong Kong, southeast China, Taiwan and other locations in Asia can reach Macao in a relatively
short time, using a variety of transportation methods, and visitors from more distant locations in Asia can take advantage
5
of short travel times by air to Zhuhai, Shenzhen, Guangzhou or Hong Kong (followed by a road, ferry or helicopter
trip to Macao). In addition, numerous air carriers fly directly into Macao International Airport from many major cities
in Asia.
Macao draws a significant number of customers who are visitors or residents of Hong Kong. One of the major
methods of transportation to Macao from Hong Kong is the jetfoil ferry service, including our ferry service, CotaiJet.
Macao is also accessible from Hong Kong by helicopter. In addition, the bridge linking Hong Kong, Macao and Zhuhai
is expected to reduce the travel time between Hong Kong and Macao and is expected to be completed sometime between
2017 and 2018.
Competition in Macao
Gaming in Macao is administered by the government through concessions awarded to three different
concessionaires and three subconcessionaires, of which we are one. No additional concessions have been granted by
the Macao government since 2002; however, if the Macao government were to allow additional gaming operators in
Macao through the grant of additional concessions or subconcessions, we would face additional competition.
Sociedade de Jogos de Macau S.A. (“SJM”) holds one of the three concessions and currently operates 21 facilities
throughout Macao. Historically, SJM was the only gaming operator in Macao. Many of its gaming facilities are relatively
small locations that are offered as amenities in hotels; however, some are large operations, including the Hotel Lisboa
and The Grand Lisboa. In February 2014, SJM announced the development of Lisboa Palace, a 2,000-room resort on
Cotai that is scheduled to open in 2017.
Wynn Resorts (Macau), S.A. (“Wynn Resorts Macau”), a subsidiary of Wynn Resorts Limited, holds a concession
and owns and operates the Wynn Macau and Encore at Wynn Macau, which opened in September 2006 and April 2010,
respectively. In May 2012, the Macao government granted a land concession to Wynn Resorts Macau, allowing the
casino operator to construct a full scale integrated resort in Cotai. The 1,700-room integrated resort, Wynn Palace, will
be located behind the City of Dreams and currently is expected to open in 2016.
In 2006, an affiliate of Publishing and Broadcasting Limited (“PBL”) purchased Wynn Resorts Macau's
subconcession right under its gaming concession, which permitted the PBL affiliate to receive a gaming subconcession
from the Macao government. In May 2007, the PBL affiliate, Melco Crown Entertainment Limited ("Melco Crown"),
opened the Crown Macao, later renamed Altira. In June 2009, Melco Crown opened the City of Dreams, an integrated
casino resort located adjacent to our Sands Cotai Central, which includes Crown Towers, Hard Rock and Grand Hyatt
hotels. Melco Crown is currently constructing its second casino resort on Cotai, Studio City, which will include 1,600
hotel rooms and is expected to be completed in mid-2015.
Galaxy Casino Company Limited (“Galaxy”) holds the third concession and has the ability to operate casino
properties independent of our subconcession agreement with Galaxy and the Macao government. Galaxy currently
operates five casinos in Macao, including StarWorld Hotel, which opened in October 2006, and Galaxy Macau, which
is located near The Venetian Macao and opened in May 2011. In April 2012, Galaxy announced the development of a
second phase of its Galaxy Macau property in Cotai. The expansion is expected to include an additional 1,350 hotel
rooms, as well as additional retail and convention and exhibition facilities. The expansion is expected to be completed
in 2015.
MGM Grand Paradise Limited, a joint venture between MGM Resorts International and Pansy Ho Chiu-King,
obtained a subconcession from SJM in April 2005, allowing the joint venture to conduct gaming operations in Macao.
The MGM Grand Macau opened in December 2007 and is located on the Macao Peninsula adjacent to the Wynn Macau.
In October 2012, MGM Grand Paradise Limited received a land concession from the Macao government to develop a
casino resort in Cotai. The 1,600-room resort, MGM Cotai, will be located behind Sands Cotai Central and currently
is expected to open in the fall of 2016.
Our Macao operations also face competition from other gaming and resort destinations, both in Asia and globally.
6
Singapore
Singapore is regarded as having the most developed financial and transportation infrastructure in the Southeast
Asia region. Singapore has established itself as a destination for both business and leisure visitors, offering convention
and exhibition facilities as well as world-class shopping malls and hotel accommodations. In 2006, after a competitive
bid process, the Singapore government awarded two concessions to develop and operate two integrated resorts. We
were awarded the concession for the Marina Bay site, which is adjacent to Singapore’s central business district, and
Genting International was awarded the second integrated resort site, located on Singapore’s Sentosa Island.
Based on figures released by the Singapore Tourism Board (the “STB”), Singapore welcomed 15.1 million
international visitors in 2014, a 3.1% decrease compared to 2013. Tourism receipts are estimated to have reached
23.5 billion Singapore dollars (“SGD,” approximately $17.8 billion at exchange rates in effect on December 31, 2014)
in 2013 (the latest information publicly available at the time filing), a 1.7% increase compared to 2012. The Casino
Regulatory Authority (the “CRA”), the gaming regulator in Singapore, does not disclose gaming revenue for the market
and thus no official figure exists.
We believe Marina Bay Sands is ideally positioned within Singapore to cater to both business and leisure visitors.
The integrated resort is centrally located within a 20-minute drive from Singapore’s Changi International Airport and
near the new Marina Bay Cruise Center, a deep-water cruise ship terminal that opened in October 2012, and Bayfront
station, a mass rapid transit station. Marina Bay Sands is also located near several entertainment attractions, including
the Gardens by the Bay botanical gardens, which opened in June 2012, and the Singapore Sports Hub, a sports complex
featuring a new 55,000-seat National Stadium, which opened in June 2014.
To date, the overall gaming market consists of a balanced contribution from both the VIP and mass gaming
segments. Consistent with our experience in Macao, Baccarat is the preferred table game in both the VIP and mass
gaming segments. Additionally, contributions from slot machines and from the mass gaming segment, including
electronic table games offerings, have enhanced the early growth of the market. As Marina Bay Sands and the Singapore
market as a whole continue to mature, we expect to broaden our visitor base to continue to capture visitors from around
the world.
Proximity to Major Asian Cities
About 100 airlines operate in Singapore, connecting it to over 300 cities in 70 countries. In 2014, 54.1 million
passengers passed through Singapore’s Changi Airport, a 0.7% increase as compared to 2013. The estimated population
within a 5-hour flight of Singapore is more than 2.0 billion. Based on figures released by the STB, the largest source
markets for visitors to Singapore for 2014 were Indonesia and China. The STB’s methodology for reporting visitor
arrivals does not recognize Malaysian citizens entering Singapore by land, although this method of visitation is generally
thought to be substantial.
Competition in Singapore
Gaming in Singapore is administered by the government through the award of licenses to two operators, of which
we are one. Pursuant to the request for proposals to develop an integrated resort at Marina Bay, Singapore (the “Request
for Proposal”), the CRA is required to ensure that there will not be more than two casino licenses during a ten-year
exclusive period (the “Exclusivity Period,” that began on March 1, 2007).
Resorts World Sentosa, which is 100% owned by Genting Singapore and located on Sentosa Island, is primarily
a family tourist destination connected to Singapore via a 500-meter long vehicular and pedestrian bridge. Apart from
the casino, the resort includes six hotels, a Universal Studios theme park, the Marine Life Park, the Maritime Experiential
Museum, aquarium, conventions and exhibitions facilities, restaurants, as well as a Malaysian food street, and retail
shops.
7
U.S. Operations
Las Vegas
Our Las Vegas Operating Properties form an integrated resort that includes The Venetian Las Vegas, The Palazzo
and the Sands Expo Center.
The Venetian Las Vegas has 4,028 suites situated in a 3,015-suite, 35-story three-winged tower rising above the
casino and the adjoining 1,013-suite, 12-story Venezia tower. The casino at The Venetian Las Vegas has approximately
120,000 square feet of gaming space and includes approximately 110 table games and 1,250 slot machines. The Venetian
Las Vegas features a variety of amenities for its guests, including a Paiza Club, several theaters and a Canyon Ranch
SpaClub.
The Palazzo features modern European ambience and design, and is directly connected to The Venetian Las Vegas
and Sands Expo Center. The casino at The Palazzo has approximately 105,000 square feet of gaming space and includes
approximately 130 table games and 1,100 slot machines. The Palazzo has a 50-floor luxury hotel tower with 3,064
suites and includes a Canyon Ranch SpaClub, a Paiza Club and a world-class theater.
The Venetian Las Vegas and The Palazzo feature two enclosed retail, dining and entertainment complexes,
currently referred to as the Grand Canal Shoppes. The complex located within The Venetian Las Vegas (previously
known as “The Grand Canal Shoppes”) and the complex located within The Palazzo (previously known as “The Shoppes
at The Palazzo”) were sold to GGP Limited Partnership (“GGP”) in 2004 and 2008, respectively.
Sands Expo Center is one of the largest overall trade show and convention facilities in the United States (as
measured by net leasable square footage), with approximately 1.2 million gross square feet of exhibit and meeting
space. We also own an approximately 1.1 million-gross-square-foot meeting and conference facility that links Sands
Expo Center to The Venetian Las Vegas and The Palazzo. Together, we offer approximately 2.3 million gross square
feet of state-of-the-art exhibition and meeting facilities that can be configured to provide small, mid-size or large meeting
rooms and/or accommodate large-scale multi-media events or trade shows.
Pennsylvania
We own and operate the Sands Bethlehem, a gaming, hotel, retail and dining complex located on the site of the
historic Bethlehem Steel Works in Bethlehem, Pennsylvania. The Sands Bethlehem features approximately 145,000
square feet of gaming space that includes approximately 180 table games and more than 3,000 slot machines; a 300-
room hotel tower; a 150,000-square-foot retail facility (“The Outlets at Sands Bethlehem”); an arts and cultural center;
and a 50,000-square foot multipurpose event center.
We own 86% of the economic interest in the gaming, hotel and entertainment portion of Sands Bethlehem through
our ownership interest in Sands Bethworks Gaming LLC (“Sands Bethworks Gaming”) and more than 35% of the
economic interest in the retail portion of Sands Bethlehem through our ownership interest in Sands Bethworks Retail
LLC (“Sands Bethworks Retail”).
Las Vegas Market
The Las Vegas hotel/casino industry is highly competitive. Hotels on the Las Vegas Strip compete with other
hotels on and off the Las Vegas Strip, including hotels in downtown Las Vegas. In addition, there are large projects in
Las Vegas currently suspended or in the development stage and when opened may target the same customers as we do.
We also compete with casinos located on Native American tribal lands. The proliferation of gaming in California and
other areas located in the same region as our Las Vegas Operating Properties could have an adverse effect on our
financial condition, results of operations or cash flows. Our Las Vegas Operating Properties also compete, to some
extent, with other hotel/casino facilities in Nevada and Atlantic City, with hotel/casino and other resort facilities
elsewhere in the country and the world, and with internet gaming and state lotteries.
In addition, certain states have legalized, and others may legalize, casino gaming in specific areas. The continued
proliferation of gaming venues could have a significant and adverse effect on our business. In particular, the legalization
of casino gaming in or near major metropolitan areas from which we traditionally attract customers could have a material
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adverse effect on our business. The current global trend toward liberalization of gaming restrictions and the resulting
proliferation of gaming venues could result in a decrease in the number of visitors to our Las Vegas Operating Properties,
which could have an adverse effect on our financial condition, results of operations or cash flows. Also, on December 23,
2011, the U.S. Department of Justice (the “DOJ”) released an opinion on the application of the Wire Act to interstate
transmission of wire communications, concluding that such communications that did not relate to a “sporting event or
contest” fell outside the prohibition of the Wire Act. In concluding as such, the DOJ reversed earlier opinions that the
Wire Act was not limited to such communications on sporting events or contests. Those states that permit these
distribution channels may also expand the gaming offerings of their lotteries in a manner that could have an adverse
effect on our business.
Las Vegas generally competes with trade show and convention facilities located in and around major U.S. cities.
Within Las Vegas, the Sands Expo Center competes with the Las Vegas Convention Center (the “LVCC”), which
currently has approximately 3.2 million gross square feet of convention and exhibit facilities. In addition to the LVCC,
some of our Las Vegas competitors have convention and conference facilities that compete with our Las Vegas Operating
Properties.
Competitors of our Las Vegas Operating Properties that can offer a hotel/casino experience that is integrated with
substantial trade show and convention, conference and meeting facilities, could have an adverse effect on our competitive
advantage in attracting trade show and convention, conference and meeting attendees.
Retail Mall Operations
We own and operate retail malls at our integrated resorts at The Venetian Macao, Four Seasons Macao, Sands
Cotai Central, Marina Bay Sands and Sands Bethlehem. Upon completion of the remaining phase of Sands Cotai
Central, we will own approximately 2.7 million square feet of gross retail space. As further described in “Agreements
Relating to the Malls in Las Vegas” below, the Grand Canal Shoppes were sold to GGP and are not owned or operated
by us. Management believes that being in the retail mall business and, specifically, owning some of the largest retail
properties in Asia will provide meaningful value for us, particularly as the retail market in Asia continues to grow.
Our malls are designed to complement our other unique amenities and service offerings provided by our integrated
resorts. Our strategy is to seek out desirable tenants that appeal to our customers and provide a wide variety of shopping
options. We generate our mall revenue primarily from leases with tenants through base minimum rents, overage rents,
management fees and reimbursements for common area maintenance ("CAM") and other expenditures. For further
information related to the financial performance of our malls, see “Item 7 — Management’s Discussion and Analysis
of Financial Condition and Results of Operations.”
The tables below set forth certain information regarding our mall operations as of December 31, 2014. These
tables do not reflect subsequent activity in 2015.
Mall Name
Shoppes at Venetian..............................................
Shoppes at Four Seasons.......................................
Shoppes at Cotai Central.......................................
Selected Significant Tenants
Total GLA(1)
771,345(2) Zara, Swarovski, Vertu, Victoria’s Secret,
Tiffany & Co., Uniqlo, Rolex
Versace, Brioni, Canali, Gucci, Dior, Armani,
Bottega Veneta, Hugo Boss, Dolce & Gabbana
330,258(3) Marks & Spencer, Kid’s Cavern, Zara, Omega,
Ralph Lauren, Nike, Chow Tai Fook
257,963
The Shoppes at Marina Bay Sands .......................
623,440(4) Louis Vuitton, Chanel, BVLGARI, Prada,
The Outlets at Sands Bethlehem ...........................
151,029
Gucci, Zara, Burberry, Versace, Dior, Cartier
Coach, Lenox, Tommy Hilfiger, Nine West,
Guess, Under Armour, Puma
____________________
(1) Represents Gross Leasable Area in square feet.
(2) Excludes approximately 152,000 square feet of space on the fifth floor and 1,500 square feet of space on the
third floor currently not on the market for lease.
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(3) At completion, the Shoppes at Cotai Central will feature up to 600,000 square feet of gross leasable area.
(4) Excludes approximately 127,000 square feet of space operated by the Company.
The following table reflects our tenant representation by category for our mall operations as of December 31,
2014:
Category
Fashion (luxury, women’s, men’s, mixed).
Square Feet
% of
Square Feet
Representative Tenants
776,998
38% Louis Vuitton, Dior, Gucci, Versace,
Restaurants and lounges ............................
Multi-Brands..............................................
Fashion accessories and footwear .............
429,562
223,200
169,392
Chanel, Fendi
21% CUT, db Bistro, Todai, North, Café Deco
11% Duty-free shops, The Atrium
8% Coach, Salvatore Ferragamo, Tumi,
Rimowa
Jewelry.......................................................
153,983
7% BVLGARI, Omega, Cartier, Rolex,
Health and beauty ......................................
Banks and services ....................................
Lifestyle, sports and entertainment............
Home furnishing and electronics...............
Specialty foods ..........................................
Arts and gifts .............................................
126,283
59,610
46,518
43,932
26,474
13,542
Tiffany & Co.
6% Sephora, The Body Shop, Sa Sa
3% Bank of China, Citibank, ICBC
2% Manchester United Experience, Adidas,
Ferrari
2% Samsung, Vertu, Zara Home
1% The Chocolate Shop, Cold Storage
Specialty
1% Emporio di Gondola, Milestone
Total...........................................................
2,069,494
100%
Advertising and Marketing
We advertise in many types of media, including television, internet, radio, newspapers, magazines and other out-
of-home advertising (e.g. billboards), to promote general market awareness of our properties as unique vacation, business
and convention destinations due to our first-class hotels, casinos, retail stores, restaurants and other amenities. We
actively engage in direct marketing as allowed in various geographic regions, which is targeted at specific market
segments, including the premium slot and table games markets.
Development Projects
We are continuing to develop our properties in Macao and the U.S. We also continue to aggressively pursue new
development opportunities globally. See “Item 7 — Management’s Discussion and Analysis of Financial Condition
and Results of Operations — Development Projects.”
Regulation and Licensing
Macao Concession and Our Subconcession
In June 2002, the Macao government granted one of three concessions to operate casinos in Macao to Galaxy.
During December 2002, we entered into a subconcession agreement with Galaxy, which was approved by the Macao
government. The subconcession agreement allows us to develop and operate certain casino projects in Macao, including
Sands Macao, The Venetian Macao, Four Seasons Macao, Sands Cotai Central and The Parisian Macao (once opened),
separately from Galaxy. Under the subconcession agreement, we are obligated to operate casino games of chance or
games of other forms in Macao. We were also obligated to develop and open The Venetian Macao and a convention
center by December 2007, and we were required to invest, or cause to be invested, at least 4.4 billion patacas
(approximately $550.6 million at exchange rates in effect on December 31, 2014) in various development projects in
Macao by June 2009, which obligations we have fulfilled.
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If the Galaxy concession is terminated for any reason, our subconcession will remain in effect. The subconcession
may be terminated by agreement between Galaxy and us. Galaxy is not entitled to terminate the subconcession
unilaterally; however, the Macao government, with the consent of Galaxy, may terminate the subconcession under
certain circumstances. Galaxy has developed, and may continue to develop, hotel and casino projects separately from
us.
We are subject to licensing and control under applicable Macao law and are required to be licensed by the Macao
gaming authorities to operate a casino. We must pay periodic fees and taxes, and our gaming license is not transferable.
We must periodically submit detailed financial and operating reports to the Macao gaming authorities and furnish any
other information that the Macao gaming authorities may require. No person may acquire any rights over the shares or
assets of Venetian Macau Limited (“VML”), SCL’s wholly owned subsidiary, without first obtaining the approval of
the Macao gaming authorities. Similarly, no person may enter into possession of its premises or operate them through
a management agreement or any other contract or through step in rights without first obtaining the approval of, and
receiving a license from, the Macao gaming authorities. The transfer or creation of encumbrances over ownership of
shares representing the share capital of VML or other rights relating to such shares, and any act involving the granting
of voting rights or other stockholders’ rights to persons other than the original owners, would require the approval of
the Macao government and the subsequent report of such acts and transactions to the Macao gaming authorities.
Our subconcession agreement requires, among other things: (i) approval of the Macao government for transfers
of shares in VML, or of any rights over or inherent to such shares, including the grant of voting rights or other
stockholder’s rights to persons other than the original owners, as well as for the creation of any charge, lien or
encumbrance on such shares; (ii) approval of the Macao government for transfers of shares, or of any rights over such
shares, in any of our direct or indirect stockholders, provided that such shares or rights are directly or indirectly equivalent
to an amount that is equal to or higher than 5% of VML’s share capital; and (iii) that the Macao government be given
notice of the creation of any encumbrance or the grant of voting rights or other stockholder’s rights to persons other
than the original owners on shares in any of the direct or indirect stockholders in VML, provided that such shares or
rights are equivalent to an amount that is equal to or higher than 5% of VML’s share capital. The requirements in
provisions (ii) and (iii) above will not apply, however, to securities listed as tradable on a stock exchange.
The Macao gaming authorities may investigate any individual who has a material relationship to, or material
involvement with, us to determine whether our suitability and/or financial capacity is affected by this individual. LVSC
and SCL shareholders with 5% or more of the share capital, directors and some of our key employees must apply for
and undergo a finding of suitability process and maintain due qualification during the subconcession term, and accept
the persistent and long-term inspection and supervision exercised by the Macao government. VML is required to notify
the Macao government immediately should VML become aware of any fact that may be material to the appropriate
qualification of any shareholder who owns 5% of the share capital, or any officer, director or key employee. Changes
in licensed positions must be reported to the Macao gaming authorities, and in addition to their authority to deny an
application for a finding of suitability or licensure, the Macao gaming authorities have jurisdiction to disapprove a
change in corporate position. If the Macao gaming authorities were to find one of our officers, directors or key employees
unsuitable for licensing, we would have to sever all relationships with that person. In addition, the Macao gaming
authorities may require us to terminate the employment of any person who refuses to file appropriate applications.
Any person who fails or refuses to apply for a finding of suitability after being ordered to do so by the Macao
gaming authorities may be found unsuitable. Any stockholder found unsuitable who holds, directly or indirectly, any
beneficial ownership of the common stock of a company incorporated in Macao and registered with the Macao
Companies and Moveable Assets Registrar (a “Macao registered corporation”) beyond the period of time prescribed
by the Macao gaming authorities may lose their rights to the shares. We will be subject to disciplinary action if, after
we receive notice that a person is unsuitable to be a stockholder or to have any other relationship with us, we:
•
•
pay that person any dividend or interest upon its shares;
allow that person to exercise, directly or indirectly, any voting right conferred through shares held by that
person;
•
pay remuneration in any form to that person for services rendered or otherwise; or
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•
fail to pursue all lawful efforts to require that unsuitable person to relinquish its shares.
The Macao gaming authorities also have the authority to approve all persons owning or controlling the stock of
any corporation holding a gaming license.
In addition, the Macao gaming authorities require prior approval for the creation of liens and encumbrances over
VML’s assets and restrictions on stock in connection with any financing.
The Macao gaming authorities must give their prior approval to changes in control of VML 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. Entities seeking to acquire control of a Macao registered corporation must satisfy
the Macao gaming authorities concerning a variety of stringent standards prior to assuming control. The Macao Gaming
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 Macao gaming authorities may consider some management opposition to corporate acquisitions, repurchases
of voting securities and corporate defense tactics affecting Macao gaming licensees, and the Macao registered
corporations affiliated with such operations, to be injurious to stable and productive corporate gaming.
The Macao gaming authorities also have the power to supervise gaming licensees in order to:
•
•
•
assure the financial stability of corporate gaming operators and their affiliates;
preserve the beneficial aspects of conducting business in the corporate form; and
promote a neutral environment for the orderly governance of corporate affairs.
The subconcession agreement requires the Macao gaming authorities’ prior approval of any recapitalization plan
proposed by VML’s Board of Directors. The Chief Executive of Macao could also require VML to increase its share
capital if he deemed it necessary.
The Macao government also has the right, after consultation with Galaxy, to unilaterally terminate the
subconcession agreement at any time upon the occurrence of specified events of default, including:
•
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•
•
•
•
•
•
•
•
the operation of gaming without permission or operation of business which does not fall within the business
scope of the subconcession;
the suspension of operations of our gaming business in Macao without reasonable grounds for more than seven
consecutive days or more than fourteen non-consecutive days within one calendar year;
the unauthorized transfer of all or part of our gaming operations in Macao;
the failure to pay taxes, premiums, levies or other amounts payable to the Macao government;
the failure to resume operations following the temporary assumption of operations by the Macao government;
the repeated failure to comply with decisions of the Macao government;
the failure to provide or supplement the guarantee deposit or the guarantees specified in the subconcession
within the prescribed period;
the bankruptcy or insolvency of VML;
fraudulent activity by VML;
serious and repeated violation by VML of the applicable rules for carrying out casino games of chance or
games of other forms or the operation of casino games of chance or games of other forms;
•
the grant to any other person of any managing power over VML; or
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•
the failure by a controlling shareholder in VML to dispose of its interest in VML following notice from the
gaming authorities of another jurisdiction in which such controlling shareholder is licensed to operate casino
games of chance to the effect that such controlling shareholder can no longer own shares in VML.
In addition, we must comply with various covenants and other provisions under the subconcession, including
obligations to:
•
•
•
•
ensure the proper operation and conduct of casino games;
employ people with appropriate qualifications;
operate and conduct casino games of chance in a fair and honest manner without the influence of criminal
activities;
safeguard and ensure Macao’s interests in tax revenue from the operation of casinos and other gaming areas;
and
• maintain a specified level of insurance.
The subconcession agreement also allows the Macao government to request various changes in the plans and
specifications of our Macao properties and to make various other decisions and determinations that may be binding on
us. For example, the Macao government has the right to require that we contribute additional capital to our Macao
subsidiaries or that we provide certain deposits or other guarantees of performance in any amount determined by the
Macao government to be necessary. VML is limited in its ability to raise additional capital by the need to first obtain
the approval of the Macao gaming and governmental authorities before raising certain debt or equity.
If our subconcession is terminated in the event of a default, the casinos and gaming-related equipment would be
automatically transferred to the Macao government without compensation to us and we would cease to generate any
revenues from these operations. In many of these instances, the subconcession agreement does not provide a specific
cure period within which any such events may be cured and, instead, we would rely on consultations and negotiations
with the Macao government to give us an opportunity to remedy any such default.
The Sands Macao, The Venetian Macao, Four Seasons Macao and Sands Cotai Central are being, and The Parisian
Macao will be, operated under our subconcession agreement. This subconcession excludes the following gaming
activities: mutual bets, lotteries, raffles, interactive gaming and games of chance or other gaming, betting or gambling
activities on ships or planes. Our subconcession is exclusively governed by Macao law. We are subject to the exclusive
jurisdiction of the courts of Macao in case of any dispute or conflict relating to our subconcession.
Our subconcession agreement expires on June 26, 2022. Unless our subconcession is extended, on that date, the
casinos and gaming-related equipment will automatically be transferred to the Macao government without compensation
to us and we will cease to generate any revenues from these operations. Beginning on December 26, 2017, the Macao
government may redeem our subconcession by giving us at least one year prior notice and by paying us fair compensation
or indemnity. See “Item 1A — Risk Factors — Risks Associated with Our International Operations — We will stop
generating any revenues from our Macao gaming operations if we cannot secure an extension of our subconcession in
2022 or if the Macao government exercises its redemption right.”
Under our subconcession, we are obligated to pay to the Macao government an annual premium with a fixed
portion and a variable portion based on the number and type of gaming tables employed and gaming machines operated
by us. The fixed portion of the premium is equal to 30.0 million patacas (approximately $3.8 million at exchange rates
in effect on December 31, 2014). The variable portion is equal to 300,000 patacas per gaming table reserved exclusively
for certain kinds of games or players, 150,000 patacas per gaming table not so reserved and 1,000 patacas per electrical
or mechanical gaming machine, including slot machines (approximately $37,542, $18,771 and $125, respectively, at
exchange rates in effect on December 31, 2014), subject to a minimum of 45.0 million patacas (approximately $5.6
million at exchange rates in effect on December 31, 2014). We also have to pay a special gaming tax of 35% of gross
gaming revenues and applicable withholding taxes. We must also contribute 4% of our gross gaming revenue to utilities
designated by the Macao government, a portion of which must be used for promotion of tourism in Macao. This
percentage may be subject to change in the future.
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Currently, the gaming tax in Macao is calculated as a percentage of gross gaming revenue; however, unlike
Nevada, gross gaming revenue does not include deductions for credit losses. As a result, if we extend credit to our
customers in Macao and are unable to collect on the related receivables from them, we have to pay taxes on our winnings
from these customers even though we were unable to collect on the related receivables. If the laws are not changed,
our business in Macao may not be able to realize the full benefits of extending credit to our customers.
In October 2013, we received an additional 5-year exemption from Macao’s corporate income tax on profits
generated by the operation of casino games of chance for the five-year period ending December 31, 2018. In May 2014,
we entered into an agreement with the Macao government effective through the end of 2018 that provides for an annual
payment of 42.4 million patacas (approximately $5.3 million at exchange rates in effect on December 31, 2014) as a
substitution for a 12% tax otherwise due from VML shareholders on dividend distributions. See “Item 1A — Risk
Factors — Risks Associated with our International Operations — We are currently not required to pay corporate income
taxes on our casino gaming operations in Macao. Additionally, we currently have an agreement with the Macao
government that provides for a fixed annual payment that is a substitution for a 12% tax otherwise due from VML’s
shareholders on dividends distributed from our Macao gaming operations. These tax arrangements expire at the end
of 2018."
Development Agreement with Singapore Tourism Board
On August 23, 2006, our wholly owned subsidiary, Marina Bay Sands Pte. Ltd. (“MBS”), entered into a
development agreement, as amended by a supplementary agreement on December 11, 2009 (the “Development
Agreement”), with the STB to design, develop, construct and operate the Marina Bay Sands. The Development
Agreement includes a concession for MBS to own and operate a casino within the integrated resort. In addition to the
casino, the integrated resort includes, among other amenities, a hotel, a retail complex, a convention center and meeting
room complex, theaters, restaurants and an art/science museum. MBS is one of two companies that have been awarded
a concession to operate a casino in Singapore. Under the Request for Proposal, the Exclusivity Period provides that
only two licensees will be granted the right to operate a casino in Singapore during the ten-year period. In connection
with entering into the Development Agreement, MBS entered into a 60-year lease with the STB for the parcels underlying
the project site and entered into an agreement with the Land Transport Authority of Singapore for the provision of
necessary infrastructure for rapid transit systems and road works within and/or outside the project site. During the
Exclusivity Period, the Company, which is currently the 100% indirect shareholder of MBS, must continue to be the
single largest entity with direct or indirect controlling interest of at least 20% in MBS, unless otherwise approved by
the CRA.
The term of the casino concession provided under the Development Agreement is for 30 years commencing from
the date the Development Agreement was entered into, or August 23, 2006. In order to renew the casino concession,
MBS must give notice to the STB and other relevant authorities in Singapore at least five years before its expiration
in August 2036. The Singapore government may terminate the casino concession prior to its expiration in order to serve
the best interests of the public, in which event fair compensation will be paid to MBS.
On April 26, 2010, MBS was issued a casino license for a three-year period, which required payment of a license
fee of SGD 37.5 million (approximately $28.3 million at exchange rates in effect on December 31, 2014). On April
19, 2013, MBS was granted a license for a further three-year period expiring on April 25, 2016, which required payment
of SGD 57.0 million (approximately $43.1 million at exchange rates in effect on December 31, 2014) as part of the
renewal process. The license is amortized over its three-year term and is renewable upon submitting a renewal
application, paying the applicable fee and meeting the renewal requirements as determined by the CRA.
The Development Agreement contains, among other things, restrictions limiting the use of the leased land to the
development and operation of the project, requirements that MBS obtain prior approval from the STB in order to
subdivide the hotel and retail components of the project, and prohibitions on any such subdivision during the Exclusivity
Period. The Development Agreement also contains provisions relating to the construction of the project and associated
deadlines for substantial completion and opening; the location of the casino within the project site and casino licensing
issues; insurance requirements; and limitations on MBS’ ability to assign the lease or sub-lease any portion of the land
during the Exclusivity Period. In addition, the Development Agreement contains events of default, including, among
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other things, the failure of MBS to perform its obligations under the Development Agreement and events of bankruptcy
or dissolution.
The Development Agreement required MBS to invest at least SGD 3.85 billion (approximately $2.91 billion at
exchange rates in effect on December 31, 2014) in the integrated resort, which was to be allocated in specified amounts
among the casino, hotel, food and beverage outlets, retail areas, meeting, convention and exhibition facilities, key
attractions, entertainment venues and public areas. This minimum investment requirement must be satisfied in full upon
the earlier of eight years from the date of the Development Agreement or three years from the issuance of the casino
license (issued in April 2010), which obligation has been fulfilled.
MBS was required to complete the construction of the Marina Bay Sands by August 22, 2014, in order to avoid
an event of default under the Development Agreement that could result in a forfeiture of the lease for the land parcels
underlying the integrated resort. Pursuant to the Development Agreement, MBS was permitted to open Marina Bay
Sands in stages and in accordance with an agreed upon schedule. This schedule was met by MBS as confirmed by an
audit conducted on behalf of the STB.
Employees whose job duties relate to the operations of the casino are required to be licensed by the relevant
authorities in Singapore. MBS also must comply with comprehensive internal control standards or regulations
concerning advertising; branch office operations; the location, floor plans and layout of the casino; casino operations
including casino related financial transactions and patron disputes, issuance of credit and collection of debt, relationships
with and permitted payments to junket operators; security and surveillance; casino access by Singaporeans and non-
Singaporeans; compliance functions and the prevention of money laundering; periodic standard and other reports to
the CRA; and those relating to social controls including the exclusion of certain persons from the casino.
There is a goods and services tax of 7% imposed on gross gaming revenue and a casino tax of 15% imposed on
the gross gaming revenue from the casino after reduction for the amount of goods and services tax, except in the case
of gaming by premium players, in which case a casino tax of 5% is imposed on the gross gaming revenue generated
from such players after reduction for the amount of the goods and services tax. The tax rates will not be changed for a
period of 15 years from March 1, 2007. The casino tax is deductible against the Singapore corporate taxable income
of MBS. The provision for bad debts arising from the extension of credit granted to gaming patrons is not deductible
against gross gaming revenue when calculating the casino tax, but is deductible for the purposes of calculating corporate
income tax and the goods and services tax (subject to the prevailing law). MBS is permitted to extend casino credit to
persons who are not Singapore citizens or permanent residents, but is not permitted to extend casino credit to Singapore
citizens or permanent residents except to premium players.
The key constraint imposed on the casino under the Development Agreement is the total size of the gaming area,
which must not be more than 15,000 square meters (approximately 161,000 square feet). The following are not counted
towards the gaming area: back of house facilities, reception, restrooms, food and beverage areas, retail shops, stairs,
escalators and lift lobbies leading to the gaming area, aesthetic and decorative displays, performance areas and major
aisles. The casino located within Marina Bay Sands may not have more than 2,500 gaming machines, but there is no
limit on the number of tables for casino games permitted in the casino.
On January 31, 2013, certain amendments to the Casino Control Act (the “Singapore Act”) became effective.
Among the changes introduced by these amendments is a revision of the maximum financial penalty that may be
imposed on a casino operator by way of disciplinary action on a number of grounds, including contravention of a
provision of the Singapore Act or a condition of the casino license. Under the amended provisions, a casino operator
may be subject to a financial penalty, for each ground of disciplinary action, of a sum not exceeding 10% of the annual
gross gaming revenue (as defined in the Singapore Act) of the casino operator for the financial year immediately
preceding the date the financial penalty is imposed.
The amendments to the Singapore Act also included an introduction of an additional factor to be considered by
the CRA in determining future applications and/or renewals for a casino license. Applicants are required to be a suitable
person to develop, maintain and promote the integrated resort as a compelling tourist destination that meets prevailing
market demand and industry standards and contributes to the tourism industry in Singapore. The Singapore government
has established an evaluation panel that will assess applicants and report to the CRA on this aspect of the casino licensing
requirements. We believe MBS’ iconic tourist destination in Singapore and the Far East is well-established at this time.
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State of Nevada
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.
Our 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 “Nevada Board”) and the Clark County Liquor and
Gaming Licensing Board (the “CCLGLB” and together with the Nevada Commission and the Nevada Board, 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:
•
•
•
•
•
the prevention of unsavory or unsuitable persons from having a direct or indirect involvement with gaming
at any time or in any capacity;
the establishment and maintenance of responsible accounting practices and procedures;
the maintenance of effective controls over the financial practices of licensees, including establishing 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;
the prevention of cheating and fraudulent practices; and
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 our Las Vegas operations.
Las Vegas Sands, LLC (“LVSLLC”) is licensed by the Nevada Gaming Authorities to operate both The Venetian
Las Vegas and The Palazzo as a single resort hotel as set forth in the Nevada Act. The gaming license requires the
periodic payment of fees and taxes and is not transferable. LVSLLC is also registered as an intermediary company of
Venetian Casino Resort, LLC (“VCR”). VCR is licensed as a manufacturer and distributor of gaming devices. LVSLLC
and VCR are collectively referred to as the “licensed subsidiaries.” LVSC is registered with the Nevada Commission
as a publicly traded corporation (the “registered corporation”). As such, we 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 the profits from, the
licensed subsidiaries without first obtaining licenses and approvals from the Nevada Gaming Authorities. Additionally,
the CCLGLB has taken the position that it has the authority to approve all persons owning or controlling the stock of
any corporation controlling a gaming licensee. We, and the licensed subsidiaries, possess all state and local government
registrations, approvals, permits and licenses required in order for us to engage in gaming activities at The Venetian
Las Vegas and The Palazzo.
The Nevada Gaming Authorities may investigate any individual who has a material relationship to or material
involvement with us or the licensed subsidiaries 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 licensed subsidiaries
must file applications with the Nevada Gaming Authorities and may be required to be licensed by the Nevada Gaming
Authorities. Our officers, directors and key employees who are actively and directly involved in the gaming activities
of the licensed subsidiaries may be required to be licensed or found suitable by the Nevada Gaming Authorities.
The Nevada Gaming Authorities may deny an application for licensing 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 us or the licensed subsidiaries, we would have to sever all relationships with
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such person. In addition, the Nevada Commission may require us or the licensed subsidiaries to terminate the
employment of any person who refuses to file appropriate applications. Determinations of suitability or questions
pertaining to licensing are not subject to judicial review in Nevada.
We, and the licensed subsidiaries, are required to submit periodic detailed financial and operating reports to the
Nevada Commission. Substantially all of our and our licensed subsidiaries’ material loans, leases, sales of securities
and similar financing transactions must be reported to or approved by the Nevada Commission.
If it were determined that we or a licensed subsidiary violated the Nevada Act, the registration and gaming licenses
we then hold could be limited, conditioned, suspended or revoked, subject to compliance with certain statutory and
regulatory procedures. In addition, we 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 casinos, and, under certain circumstances, earnings generated during the
supervisor’s appointment (except for the reasonable rental value of the casinos) 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) have a material adverse effect on our gaming operations.
Any beneficial holder of our voting securities, regardless of the number of shares owned, may be required to file
an application, be investigated, and have its suitability as a beneficial holder of our 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 our voting securities to report the acquisition
to the Chairman of the Nevada Board. The Nevada Act requires that beneficial owners of more than 10% of our 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 25%, of our voting securities (subject
to certain additional holdings as a result of certain debt restructurings), 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.
Additionally, an institutional investor that has been granted such a waiver may acquire more than 25% but not more
than 29% of our voting securities if such additional ownership results from a stock re-purchase program and such
institutional investor does not purchase or otherwise acquire any additional voting securities that would result in an
increase in its ownership percentage.
An institutional investor will be deemed to hold voting securities only for investment purposes if it acquires and
holds the voting securities 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 our Board of Directors, any change in our
corporate charter, by-laws, management, policies or our operations or any of our gaming affiliates, or any other action
that the Nevada Commission finds to be inconsistent with holding our voting securities only for investment purposes.
Activities that are deemed consistent with holding voting securities only for investment purposes include:
•
voting on all matters voted on by stockholders;
• 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 management, policies or operations; and
•
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. 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 unsuitable. The same
restrictions apply to a record owner if the record owner, after request, fails to identify the beneficial owner. Any
stockholder found unsuitable who holds, directly or indirectly, any beneficial ownership of the common stock of a
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registered corporation beyond such period of time as may be prescribed by the Nevada Commission may be guilty of
a criminal offense. We are subject to disciplinary action if, after we receive notice that a person is unsuitable to be a
stockholder or to have any other relationship with us or a licensed subsidiary, we, or any of the licensed subsidiaries:
•
•
•
allow that person to exercise, directly or indirectly, any voting right conferred through securities held by that
person;
pay remuneration in any form to that person for services rendered or otherwise; or
fail to pursue all lawful efforts to require such unsuitable person to relinquish his or her voting securities
including, if necessary, the purchase for cash at fair market value.
Our charter documents include provisions intended to help us comply with these requirements.
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:
•
•
•
pays to the unsuitable person any dividend, interest, or any distribution whatsoever;
recognizes any voting right by such unsuitable person in connection with such securities; or
pays the unsuitable person remuneration in any form.
We are 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 and we are 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. We are also required to render maximum assistance in determining the identity
of the beneficial owner.
We cannot make a public offering of any securities without the prior approval of the Nevada Commission if the
securities or the proceeds from the offering are intended to be used to construct, acquire or finance gaming facilities
in Nevada, or to retire or extend obligations incurred for such purposes. On November 15, 2012, the Nevada Commission
granted us prior approval to make public offerings for a period of three years, subject to certain conditions (the “shelf
approval”). The shelf approval, however, may be rescinded for good cause without prior notice upon the issuance of
an interlocutory stop order by the Chairman of the Nevada Board. The shelf approval does not constitute a finding,
recommendation, or approval by the Nevada Commission or the Nevada Board as to the investment merits of any
securities offered under the shelf approval. Any representation to the contrary is unlawful.
Changes in our control 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
Nevada Board 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:
•
assure the financial stability of corporate gaming operators and their affiliates;
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•
•
preserve the beneficial aspects of conducting business in the corporate form; and
promote a neutral environment for the orderly governance of corporate affairs.
Approvals are, in certain circumstances, required from the Nevada Commission before we 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 Board of Directors in
response to a tender offer made directly to our 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 monthly, quarterly or annually and are based upon:
•
•
•
a percentage of the gross revenues received;
the number of gaming devices operated; or
the number of table games operated.
The tax on gross revenues received is generally 6.75%. In addition, an excise tax is paid by us on charges for
admission to any facility where certain forms of live entertainment are provided. VCR is also required to pay certain
fees and taxes to the State of Nevada as a licensed manufacturer and distributor.
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 operation
outside of Nevada, is required to deposit with the Nevada Board, and thereafter maintain, a revolving fund in the amount
of $10,000 to pay the expenses of any investigation by the Nevada Board into their participation in such foreign gaming
operation. 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 or who has been
found guilty of cheating at gambling.
The sale of alcoholic beverages by the licensed subsidiaries on the casino premises and at the Sands Expo Center
is subject to licensing, control and regulation by the applicable local authorities. Our licensed subsidiaries have obtained
the necessary liquor licenses to sell alcoholic beverages. 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 on our operations.
Commonwealth of Pennsylvania
Sands Bethworks Gaming is subject to the rules and regulations promulgated by the Pennsylvania Gaming Control
Board (“PaGCB”) and the Pennsylvania Department of Revenue, the on-site direction of the Pennsylvania State Police
and the requirements of other agencies.
On December 20, 2006, we were awarded one of two Category 2 “at large” gaming licenses available in
Pennsylvania. A location in the Pocono Mountains was awarded the other Category 2 “at large” license. On the same
day, two Category 2 licenses were awarded to applicants for locations in Philadelphia, a Category 2 license was awarded
to an applicant in Pittsburgh, and six race tracks were awarded Category 1 licenses. One of the Philadelphia Category
2 licenses was revoked by the PaGCB in December 2010. The revocation was upheld in November 2011 by an
intermediate appellate court in Pennsylvania and became final in March 2012 when the Pennsylvania Supreme Court
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denied a discretionary appeal from the intermediate appellate court’s ruling. On November 18, 2014, the PaGCB granted
the application for licensure of the second Pennsylvania Category 2 licensee, Stadium Casino, LLC. The award of the
license to Stadium Casino, LLC, through a contest with three other applicants, has been appealed to the Pennsylvania
Supreme Court. A final resolution is expected in 2015.
The principal difference between Category 1 and Category 2 licenses is that the former is available only to certain
race tracks. A Category 1 or Category 2 licensee is authorized to open with up to 3,000 slot machines and to increase
to up to 5,000 slot machines upon approval of the PaGCB, which may not take effect earlier than six months after
opening. The PaGCB also is permitted to award three Category 3 licenses. A Category 3 licensee is authorized to operate
up to 600 slot machines and 50 table games or up to 500 slot machines without table games. To date, two Category 3
licenses have been awarded: the Valley Forge Convention Center in suburban Philadelphia and the Nemacolin
Woodlands Resort in Fayette County, Pennsylvania. An additional Category 3 license may be issued, but not before
July 2017, following a formal application process.
In July 2007, we paid a $50.0 million licensing fee to the Commonwealth of Pennsylvania and, in August 2007,
were issued our gaming license by the PaGCB. Just prior to the opening of the casino at Sands Bethlehem, we were
required to make a deposit of $5.0 million, which was reduced to $1.5 million in January 2010 when the law was
amended, to cover weekly withdrawals of our share of the cost of regulation and the amount withdrawn must be
replenished weekly.
In February 2010, we submitted a petition to the PaGCB to obtain a table games operation certificate to operate
table games at Sands Bethlehem, based on a revision to the law in 2010 that authorized table games. The petition was
approved in April 2010, we paid a $16.5 million table game licensing fee in May 2010 and were issued a table games
certificate in June 2010. Table games operations commenced on July 18, 2010.
We must notify the PaGCB if we become aware of any proposed or contemplated change of control including
more than 5% of the ownership interests of Sands Bethworks Gaming or of more than 5% of the ownership interests
of any entity that owns, directly or indirectly, at least 20% of Sands Bethworks Gaming, including LVSC. The acquisition
by a person or a group of persons acting in concert of more than 20% of the ownership interests of Sands Bethworks
Gaming or of any entity that owns, directly or indirectly, at least 20% of Sands Bethworks Gaming, with the exception
of the ownership interest of a person at the time of the original licensure when the license fee was paid, would be defined
as a change of control under applicable Pennsylvania gaming law and regulations. Upon a change of control, the acquirer
of the ownership interests would be required to qualify for licensure and to pay a new license fee of $50.0 million or
a lesser “change of control” fee as determined by the PaGCB. In December 2007, the PaGCB adopted a $2.5 million
fee to be assessed on an acquirer in connection with a change in control unless special circumstances dictate otherwise.
The PaGCB retains the discretion to eliminate the need for qualification and may reduce the license fee upon a change
of control. The PaGCB may provide up to 120 days for any person who is required to apply for a license and who is
found not qualified to completely divest the person’s ownership interest.
Any person who acquires beneficial ownership of 5% or more of our voting securities will be required to apply
to the PaGCB for licensure, obtain licensure and remain licensed. Licensure requires, among other things, that the
applicant establish by clear and convincing evidence the applicant’s good character, honesty and integrity. Additionally,
any trust that holds 5% or more of our voting securities is required to be licensed by the PaGCB and each individual
who is a grantor, trustee or beneficiary of the trust is also required to be licensed by the PaGCB. Under certain
circumstances and under the regulations of the PaGCB, an “institutional investor” as defined under the regulations of
the PaGCB, which acquires beneficial ownership of 5% or more, but less than 10%, of our voting securities, may not
be required to be licensed by the PaGCB provided the institutional investor files an Institutional Notice of Ownership
Form with the PaGCB Bureau of Licensing and has filed, and remains eligible to file, a statement of beneficial ownership
on Schedule 13G with the SEC as a result of this ownership interest. In addition, any beneficial owner of our voting
securities, regardless of the number of shares beneficially owned, may be required at the discretion of the PaGCB to
file an application for licensure.
In the event a security holder is required to be found qualified and is not found qualified, the security holder may
be required by the PaGCB to divest of the interest at a price not exceeding the cost of the interest.
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Employees
We directly employ approximately 48,500 employees worldwide and hire temporary employees on an as-needed
basis. Our employees are not covered by collective bargaining agreements, except as discussed below with respect to
our Sands Expo Center employees. We believe that we have good relations with our employees.
Certain unions have engaged in confrontational and obstructive tactics at some of our properties, including
contacting potential customers, tenants and investors, objecting to various administrative approvals and picketing, and
may continue these tactics in the future. Although we believe we will be able to operate despite such tactics, no assurance
can be given that we will be able to do so or that the failure to do so would not have a material adverse effect on our
financial condition, results of operations or cash flows. 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 effect on
our financial condition, results of operations or cash flows.
Certain culinary personnel are hired from time to time for trade shows and conventions at Sands Expo Center
and are covered under a collective bargaining agreement between Local 226 and Sands Expo Center. This collective
bargaining agreement expired in December 2000, but automatically renews on an annual basis. As a result, Sands Expo
Center is operating under the terms of the expired bargaining agreement with respect to these employees.
Intellectual Property
Our intellectual property (“IP”) portfolio currently consists of copyrights, domain names and domain name system
configurations, patents, trade secrets, trademarks, service marks and trade names. We believe that the name recognition,
brand identification and image that we have developed through our intellectual properties attract customers to our
facilities, drive customer loyalty and contribute to our success. We register and protect our intellectual property in the
jurisdictions in which we operate or significantly advertise, as well as in countries in which we may operate in the
future.
Agreements Relating to the Malls in Las Vegas
The Grand Canal Shoppes
In May 2004, we completed the sale of The Grand Canal Shoppes and leased to GGP 19 retail and restaurant
spaces on the casino level of The Venetian Las Vegas for 89 years with annual rent of one dollar, and GGP assumed
our interest as landlord under the various leases associated with these 19 spaces. In addition, we agreed with GGP to:
•
•
•
•
continue to be obligated to fulfill certain lease termination and asset purchase agreements;
lease the portion of the theater space located within The Grand Canal Shoppes from GGP for a period of
25 years, subject to an additional 50 years of extension options, with initial fixed minimum rent of $3.3 million
per year;
lease the gondola retail store and the canal space located within The Grand Canal Shoppes from GGP (and by
amendment the extension of the canal space extended into The Shoppes at The Palazzo) for a period of 25 years,
subject to an additional 50 years of extension options, with initial fixed minimum rent of $3.5 million per year;
and
lease certain office space from GGP for a period of 10 years, subject to an additional 65 years of extension
options, with initial annual rent of approximately $0.9 million.
The lease payments relating to the theater, the canal space within The Grand Canal Shoppes and the office space
from GGP are subject to automatic increases of 5% in the sixth lease year and each subsequent fifth lease year.
The Shoppes at The Palazzo
We contracted to sell The Shoppes at The Palazzo to GGP pursuant to a purchase and sale agreement dated as of
April 12, 2004, as amended (the “Amended Agreement”). Under the Amended Agreement, we also leased to GGP
certain restaurant and retail space on the casino level of The Palazzo for 89 years with annual rent of one dollar and
GGP assumed our interest as landlord under the various space leases associated with these spaces. On June 24, 2011,
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we reached a settlement with GGP regarding the final purchase price. Under the terms of the settlement, we retained
the $295.4 million of proceeds previously received and participate in certain potential future revenues earned by GGP.
Cooperation Agreement
Our business plan calls for each of The Venetian Las Vegas, The Palazzo, Sands Expo Center, the Grand Canal
Shoppes and the high-rise residential condominium tower that was being constructed on the Las Vegas strip between
The Palazzo and The Venetian Las Vegas (the “Las Vegas Condo Tower”), though separately owned, to be integrally
related components of one facility (the “LV Integrated Resort”). In establishing the terms for the integrated operation
of these components, the cooperation agreement sets forth agreements regarding, among other things, encroachments,
easements, operating standards, maintenance requirements, insurance requirements, casualty and condemnation, joint
marketing, and the sharing of some facilities and related costs. Subject to applicable law, the cooperation agreement
binds all current and future owners of all portions of the LV Integrated Resort and has priority over the liens securing
LVSLLC’s senior secured credit facility and in some or all respects any liens that may secure any indebtedness of the
owners of any portion of the LV Integrated Resort. Accordingly, subject to applicable law, the obligations in the
cooperation agreement will “run with the land” if any of the components change hands.
Operating Covenants. The cooperation agreement regulates certain aspects of the operation of the LV Integrated
Resort. For example, under the cooperation agreement, we are obligated to operate The Venetian Las Vegas continuously
and to use it exclusively in accordance with standards of first-class Las Vegas Boulevard-style hotels and casinos. We
are also obligated to operate and use the Sands Expo Center exclusively in accordance with standards of first-class
convention, trade show and exposition centers. The owners of the Grand Canal Shoppes are obligated to operate their
property exclusively in accordance with standards of first-class restaurant and retail complexes. For so long as The
Venetian Las Vegas is operated in accordance with a “Venetian” theme, the owner of the Grand Canal Shoppes must
operate The Grand Canal Shoppes in accordance with the overall Venetian theme.
Maintenance and Repair. We must maintain The Venetian Las Vegas and The Palazzo as well as some common
areas and common facilities that are to be shared with the Grand Canal Shoppes. The cost of maintenance of all shared
common areas and common facilities is to be shared between us and the owners of the Grand Canal Shoppes. We must
also maintain, repair and restore Sands Expo Center and certain common areas and common facilities located in Sands
Expo Center. The owners of the Grand Canal Shoppes must maintain, repair and restore the Grand Canal Shoppes and
certain common areas and common facilities located within.
Insurance. We and the owners of the Grand Canal Shoppes must maintain minimum types and levels of insurance,
including property damage, general liability and business interruption insurance. The cooperation agreement establishes
an insurance trustee to assist in the implementation of the insurance requirements.
Parking. The cooperation agreement also addresses issues relating to the use of the LV Integrated Resort’s parking
facilities and easements for access. The Venetian Las Vegas, The Palazzo, Sands Expo Center and the Grand Canal
Shoppes may use the parking spaces in the LV Integrated Resort’s parking facilities on a “first come, first served” basis.
The LV Integrated Resort’s parking facilities are owned, maintained and operated by us, with the operating costs
proportionately allocated among and/or billed to the owners of the components of the LV Integrated Resort. Each party
to the cooperation agreement has granted to the others non-exclusive easements and rights to use the roadways and
walkways on each other’s properties for vehicular and pedestrian access to the parking garages.
Utility Easement. All property owners have also granted each other all appropriate and necessary easement rights
to utility lines servicing the LV Integrated Resort.
Consents, Approvals and Disputes. If any current or future party to the cooperation agreement has a consent or
approval right or has discretion to act or refrain from acting, the consent or approval of such party will only be granted
and action will be taken or not taken only if a commercially reasonable owner would do so and such consent, approval,
action or inaction would not have a material adverse effect on the property owned by such property owner. The
cooperation agreement provides for the appointment of an independent expert to resolve some disputes between the
parties, as well as for expedited arbitration for other disputes.
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Sale of the Grand Canal Shoppes by GGP. We have a right of first offer in connection with any proposed sale of
the Grand Canal Shoppes by GGP. We also have the right to receive notice of any default by GGP sent by any lender
holding a mortgage on the Grand Canal Shoppes, if any, and the right to cure such default subject to our meeting certain
net worth tests.
ITEM 1A. — RISK FACTORS
You should carefully consider the risk factors set forth below as well as the other information contained in this
Annual Report on Form 10-K in connection with evaluating the Company. Additional risks and uncertainties not
currently known to us or that we currently deem to be immaterial may also have a material adverse effect on our
business, financial condition, results of operations or cash flows. Certain statements in “Risk Factors” are forward-
looking statements. See “Item 7 — Management’s Discussion and Analysis of Financial Condition and Results of
Operations — Special Note Regarding Forward-Looking Statements.”
Risks Related to Our Business
Our business is particularly sensitive to reductions in discretionary consumer and corporate spending as a result
of downturns in the economy.
Consumer demand for hotel/casino resorts, trade shows and conventions and for the type of luxury amenities we
offer is particularly sensitive to downturns in the economy and the corresponding impact on discretionary spending on
leisure activities. Changes in discretionary consumer spending or corporate spending on conventions and business
travel could be driven by many factors, such as: perceived or actual general economic conditions; any further weaknesses
in the job or housing market, additional credit market disruptions; high energy, fuel and food costs; the increased cost
of travel; the potential for bank failures; the weakened job market; perceived or actual disposable consumer income
and wealth; fears of recession and changes in consumer confidence in the economy; or fears of war and future acts of
terrorism. These factors could reduce consumer and corporate demand for the luxury amenities and leisure activities
we offer, thus imposing additional limits on pricing and harming our operations.
The terms of our debt instruments and our current debt service obligations may restrict our current and future
operations, particularly our ability to finance additional growth, respond to changes or take some actions that
may otherwise be in our best interests.
Our current debt instruments contain, and any future debt instruments likely will contain, a number of restrictive
covenants that impose significant operating and financial restrictions on us, including restrictions on our ability to:
•
•
•
incur additional debt, including providing guarantees or credit support;
incur liens securing indebtedness or other obligations;
dispose of assets;
• make certain acquisitions;
•
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•
•
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pay dividends or make distributions and make other restricted payments, such as purchasing equity interests,
repurchasing junior indebtedness or making investments in third parties;
enter into sale and leaseback transactions;
engage in any new businesses;
issue preferred stock; and
enter into transactions with our stockholders and our affiliates.
In addition, our Macao, Singapore and U.S. credit agreements contain various financial covenants. See “Item 8
— Financial Statements and Supplementary Data — Notes to Consolidated Financial Statements — Note 8 — Long-
Term Debt” for further description of these covenants.
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As of December 31, 2014, we had $9.89 billion of long-term debt outstanding. This indebtedness could have
important consequences to us. For example, it could:
• make it more difficult for us to satisfy our debt service obligations;
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•
•
•
•
•
increase our vulnerability to general adverse economic and industry conditions;
impair our ability to obtain additional financing in the future for working capital needs, capital expenditures,
development projects, acquisitions or general corporate purposes;
require us to dedicate a significant portion of our cash flow from operations to the payment of principal and
interest on our debt, which would reduce the funds available for our operations and development projects;
limit our flexibility in planning for, or reacting to, changes in the business and the industry in which we operate;
place us at a competitive disadvantage compared to our competitors that have less debt; and
subject us to higher interest expense in the event of increases in interest rates as a significant portion of our
debt is, and will continue to be, at variable rates of interest.
Subject to applicable laws, including gaming laws, and certain agreed upon exceptions, our debt is secured by
liens on substantially all of our assets, except for our equity interests in our subsidiaries.
We may elect to arrange additional financing to fund the balance of our Cotai Strip developments. If such additional
financing is necessary, we cannot assure you that we will obtain all the financing required for the construction and
opening of our remaining planned projects on suitable terms, if at all.
We are subject to extensive regulation and the cost of compliance or failure to comply with such regulations that
govern our operations in any jurisdiction where we operate may have an adverse effect on our business, financial
condition, results of operations or cash flows.
We are required to obtain and maintain licenses from various jurisdictions in order to operate certain aspects of
our business, and we are subject to extensive background investigations and suitability standards in our gaming business.
We also will become subject to regulation in any other jurisdiction where we choose to operate in the future. There can
be no assurance that we will be able to obtain new licenses or renew any of our existing licenses, or that if such licenses
are obtained, that such licenses will not be conditioned, suspended or revoked, and the loss, denial or non-renewal of
any of our licenses could have a material adverse effect on our business, financial condition, results of operations or
cash flows.
Our gaming operations and the ownership of our securities are subject to extensive regulation by the Nevada
Commission, the Nevada Board and the CCLGLB. The Nevada Gaming Authorities have broad authority with respect
to licensing and registration of our business entities and individuals investing in or otherwise involved with us.
Although we currently are registered with, and LVSLLC and VCR currently hold gaming licenses issued by, the
Nevada Gaming Authorities, these authorities may, among other things, revoke the gaming license of any corporate
entity or the registration of a registered corporation or any entity registered as a holding company of a corporate licensee
for violations of gaming regulations.
In addition, the Nevada Gaming Authorities may, under certain conditions, revoke the license or finding of
suitability of any officer, director, controlling person, stockholder, noteholder or key employee of a licensed or registered
entity. If our gaming licenses were revoked for any reason, the Nevada Gaming Authorities could require the closing
of our casinos, which would have a material adverse effect on our business, financial condition, results of operations
or cash flows. In addition, compliance costs associated with gaming laws, regulations or licenses are significant. Any
change in the laws, regulations or licenses applicable to our business or gaming licenses could require us to make
substantial expenditures or could otherwise have a material adverse effect on our business, financial condition, results
of operations or cash flows.
A similar dynamic exists in all jurisdictions where we operate and a regulatory action against one of our operating
entities in any gaming jurisdiction could impact our operations in other gaming jurisdictions where we do business.
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For a more complete description of the gaming regulatory requirements that have an effect on our business, see “Item 1
— Business — Regulation and Licensing.”
We are subject to regulations imposed by the Foreign Corrupt Practices Act (the “FCPA”), which generally
prohibits U.S. companies and their intermediaries from making improper payments to foreign officials for the purpose
of obtaining or retaining business. On February 9, 2011, LVSC received a subpoena from the SEC requesting that we
produce documents relating to our compliance with the FCPA. We have also been advised by the DOJ that it is conducting
a similar investigation. Any violation of the FCPA could have a material adverse effect on our financial condition. See
“Item 8 — Financial Statements and Supplementary Data — Notes to Consolidated Financial Statements — Note 13
— Commitments and Contingencies — Litigation” for further description of the current status of this matter.
We also deal with significant amounts of cash in our operations and are subject to various reporting and anti-
money laundering regulations. Any violation of anti-money laundering laws or regulations, or any accusations of money
laundering or regulatory investigations into possible money laundering activities, by any of our properties, employees,
customers could have a material adverse effect on our financial condition, results of operations or cash flows.
There are significant risks associated with our ongoing and future construction projects, which could have an
adverse effect on our financial condition, results of operations or cash flows from these planned facilities.
Our ongoing and future construction projects, such as our Cotai Strip projects, entail significant risks. Construction
activity requires us to obtain qualified contractors and subcontractors, the availability of which may be uncertain.
Construction projects are subject to cost overruns and delays caused by events outside of our control or, in certain cases,
our contractors’ control, such as shortages of materials or skilled labor, unforeseen engineering, environmental and/or
geological problems, work stoppages, weather interference, unanticipated cost increases and unavailability of
construction materials or equipment. Construction, equipment or staffing problems or difficulties in obtaining any of
the requisite materials, licenses, permits, allocations and authorizations from governmental or regulatory authorities
could increase the total cost, delay, jeopardize, prevent the construction or opening of our projects, or otherwise affect
the design and features. In addition, the number of ongoing projects and their locations throughout the world present
unique challenges and risks to our management structure. If our management is unable to manage successfully our
worldwide construction projects, it could have an adverse effect on our financial condition, results of operations or
cash flows.
The anticipated costs and completion dates for our current projects are based on budgets, designs, development
and construction documents and schedule estimates that we have prepared with the assistance of architects and other
construction development consultants and that are subject to change as the design, development and construction
documents are finalized and as actual construction work is performed. A failure to complete our projects on budget or
on schedule may have an adverse effect on our financial condition, results of operations or cash flows. The estimated
costs to complete and open our remaining planned projects are currently not determinable with certainty and therefore
may have an adverse effect on our financial condition, results of operations or cash flows. See also “— Risks Associated
with Our International Operations — We are currently required to build and open The Parisian Macao by April 2016
and complete Sands Cotai Central by December 2016. If we are unable to meet the respective deadlines and the deadlines
for either development are not extended, we may lose the respective land concession, which would prohibit us from
operating any facilities developed under such land concession.”
Because we are currently dependent primarily upon our properties in three markets for all of our cash flow, we
are subject to greater risks than competitors with more operating properties or that operates in more markets.
We currently do not have material operations other than our Macao, Singapore and Las Vegas properties. As a
result, we are primarily dependent upon these properties for all of our cash.
Given that our operations are currently conducted primarily at properties in Macao, Singapore and Las Vegas
and that a large portion of our planned future development is in Macao, we will be subject to greater degrees of risk
than competitors with more operating properties or that operates in more markets. The risks to which we will have a
greater degree of exposure include the following:
•
local economic and competitive conditions;
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inaccessibility due to inclement weather, road construction or closure of primary access routes;
decline in air passenger traffic due to higher ticket costs or fears concerning air travel;
changes in local and state governmental laws and regulations, including gaming laws and regulations;
natural or man-made disasters, or outbreaks of infectious diseases;
changes in the availability of water; and
a decline in the number of visitors to Macao, Singapore or Las Vegas.
Our insurance coverage may not be adequate to cover all possible losses that our properties could suffer. In
addition, our insurance costs may increase and we may not be able to obtain the same insurance coverage in the
future.
We have comprehensive property and liability insurance policies for our properties in operation, as well as those
in the course of construction, with coverage features and insured limits that we believe are customary in their breadth
and scope. Market forces beyond our control may nonetheless limit the scope of the insurance coverage we can obtain
or our ability to obtain coverage at reasonable rates. Certain types of losses, generally of a catastrophic nature, such as
earthquakes, hurricanes and floods, or terrorist acts, or certain liabilities may be uninsurable or too expensive to justify
obtaining insurance. As a result, we may not be successful in obtaining insurance without increases in cost or decreases
in coverage levels. In addition, in the event of a substantial loss, the insurance coverage we carry may not be sufficient
to pay the full market value or replacement cost of our lost investment or in some cases could result in certain losses
being totally uninsured. As a result, we could lose some or all of the capital we have invested in a property, as well as
the anticipated future revenue from the property, and we could remain obligated for debt or other financial obligations
related to the property.
Our debt instruments and other material agreements require us to maintain a certain minimum level of insurance.
Failure to satisfy these requirements could result in an event of default under these debt instruments or material
agreements.
We depend on the continued services of key managers and employees. If we do not retain our key personnel or
attract and retain other highly skilled employees, our business will suffer.
Our ability to maintain our competitive position is dependent to a large degree on the services of our senior
management team, including Sheldon G. Adelson and our other executive officers. The loss of Mr. Adelson’s services
or the services of our other senior managers, or the inability to attract and retain additional senior management personnel
could have a material adverse effect on our business. Mr. Adelson’s employment agreement is scheduled to expire in
December 2015 and is subject to extensions.
The interests of our principal stockholder in our business may be different from yours.
Mr. Adelson, his family members and trusts and other entities established for the benefit of Mr. Adelson and/or
his family members (collectively our “Principal Stockholder’s family”) beneficially own approximately 54% of our
outstanding common stock as of December 31, 2014. Accordingly, Mr. Adelson exercises significant influence over
our business policies and affairs, including the composition of our Board of Directors and any action requiring the
approval of our stockholders, including the adoption of amendments to our articles of incorporation and the approval
of a merger or sale of substantially all of our assets. The concentration of ownership may also delay, defer or even
prevent a change in control of our company and may make some transactions more difficult or impossible without the
support of Mr. Adelson. The interests of Mr. Adelson may differ from your interests.
We are a parent company and our primary source of cash is and will be distributions from our subsidiaries.
We are a parent company with limited business operations of our own. Our main asset is the capital stock of our
subsidiaries. We conduct most of our business operations through our direct and indirect subsidiaries. Accordingly, our
primary sources of cash are dividends and distributions with respect to our ownership interests in our subsidiaries that
are derived from the earnings and cash flow generated by our operating properties. Our subsidiaries might not generate
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sufficient earnings and cash flow to pay dividends or distributions in the future. Our subsidiaries’ payments to us will
be contingent upon their earnings and upon other business considerations. In addition, our subsidiaries’ debt instruments
and other agreements limit or prohibit certain payments of dividends or other distributions to us. We expect that future
debt instruments for the financing of our other developments will contain similar restrictions.
Our business is sensitive to the willingness of our customers to travel. Acts of terrorism, regional political events
and developments in the conflicts in certain countries could cause severe disruptions in air travel that reduce
the number of visitors to our facilities, resulting in a material adverse effect on our financial condition, results
of operations or cash flows.
We are dependent on the willingness of our customers to travel. Only a small amount of our business is and will
be generated by local residents. Most of our customers travel to reach our Macao, Singapore, Las Vegas and Pennsylvania
properties. Acts of terrorism may severely disrupt domestic and international travel, which would result in a decrease
in customer visits to Macao, Singapore, Las Vegas and Pennsylvania, including our properties. Regional conflicts could
have a similar effect on domestic and international travel. Management cannot predict the extent to which disruptions
in air or other forms of travel as a result of any further terrorist act, outbreak of hostilities or escalation of war would
have an adverse effect on our financial condition, results of operations or cash flows.
We extend credit to a large portion of our customers and we may not be able to collect gaming receivables from
our credit players.
We conduct our gaming activities on a credit and cash basis. Any such credit we extend is unsecured. Table games
players typically are extended more credit than slot players, and high-stakes players typically are extended more credit
than patrons who tend to wager lower amounts. High-end gaming is more volatile than other forms of gaming, and
variances in win-loss results attributable to high-end gaming may have a significant positive or negative impact on
cash flow and earnings in a particular quarter.
During the year ended December 31, 2014, approximately 23.0%, 31.0% and 72.3% of our table games drop at
our Macao properties, Marina Bay Sands and our Las Vegas properties, respectively, was from credit-based wagering,
while table games play at our Pennsylvania property is primarily conducted on a cash basis. We extend credit to those
customers whose level of play and financial resources warrant, in the opinion of management, an extension of credit.
These large receivables could have a significant impact on our results of operations if deemed uncollectible.
While gaming debts evidenced by a credit instrument, including what is commonly referred to as a “marker,”
and judgments on gaming debts are enforceable under the current laws of Nevada, and Nevada judgments on gaming
debts are enforceable in all states under the Full Faith and Credit Clause of the U.S. Constitution, other jurisdictions
around the world, including jurisdictions our gaming customers may come from, may determine that enforcement of
gaming debts is against public policy. Although courts of some foreign nations will enforce gaming debts directly and
the assets in the U.S. of foreign debtors may be reached to satisfy a judgment, judgments on gaming debts from courts
in the U.S. and elsewhere are not binding on the courts of many foreign nations.
Win rates for our gaming operations depend on a variety of factors, some beyond our control, and the winnings
of our gaming customers could exceed our casino winnings.
The gaming industry is characterized by an element of chance. In addition to the element of chance, win rates
are also affected by other factors, including players’ skill and experience, the mix of games played, the financial resources
of players, the spread of table limits, the volume of bets played and the amount of time played. Our gaming profits are
mainly derived from the difference between our casino winnings and the casino winnings of our gaming customers.
Since there is an inherent element of chance in the gaming industry, we do not have full control over our winnings or
the winnings of our gaming customers. If the winnings of our gaming customers exceed our winnings, we may record
a loss from our gaming operations, which could have a material adverse effect on our business, financial condition,
results of operations and cash flows.
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We face the risk of fraud and cheating.
Our gaming customers may attempt or commit fraud or cheat in order to increase winnings. Acts of fraud or
cheating could involve the use of counterfeit chips or other tactics, possibly in collusion with our employees. Internal
acts of cheating could also be conducted by employees through collusion with dealers, surveillance staff, floor managers
or other casino or gaming area staff. Failure to discover such acts or schemes in a timely manner could result in losses
in our gaming operations. In addition, negative publicity related to such schemes could have an adverse effect on our
reputation, potentially causing a material adverse effect on our business, financial condition, results of operations and
cash flows.
A failure to establish and protect our IP rights could have an adverse effect on our business, financial condition
and results of operations.
We endeavor to establish and protect our IP rights and our goods and services through trademarks and service
marks, copyrights, patents, trade secrets, domain names, licenses, other contractual provisions, nondisclosure
agreements, and confidentiality and information-security measures and procedures. There can be no assurance, however,
that the steps we take to protect our IP will be sufficient. Our inability to adequately obtain, maintain or defend our IP
rights for any reason may have a material adverse effect on our business, financial condition and results of operations.
Examples include: (1) if one of our marks becomes so well known by the public that its use is deemed generic, we may
lose exclusive rights to such mark or be forced to rebrand; (2) if a third party claims our IP has infringed, currently
infringes, or could in the future infringe upon its IP rights, we may need to cease use of such IP, defend our rights or
take other steps; (3) if third parties violate their obligations to us to maintain the confidentiality of our proprietary
information or there is a security breach or lapse, our business may be affected; or (4) if third parties misappropriate
or infringe upon our IP, our business could be affected.
Conflicts of interest may arise because certain of our directors and officers are also directors of SCL.
In November 2009, our subsidiary, SCL, listed its ordinary shares on The Main Board of The Stock Exchange
of Hong Kong Limited (the “SCL Offering”). We currently own 70.1% of the issued and outstanding ordinary shares
of SCL. As a result of SCL having stockholders who are not affiliated with us, we and certain of our officers and
directors who also serve as officers and/or directors of SCL may have conflicting fiduciary obligations to our stockholders
and to the minority stockholders of SCL. Decisions that could have different implications for us and SCL, including
contractual arrangements that we have entered into or may in the future enter into with SCL may give rise to the
appearance of a potential conflict of interest.
Changes in tax laws and regulations could impact our financial condition and results of operations.
We are subject to taxation and regulation by various government agencies, primarily in Macao, Singapore and
the U.S. (federal, state and local levels). From time to time, U.S. federal, state, local and foreign governments make
substantive changes to tax rules and the application of these rules, which could result in higher taxes than would be
incurred under existing tax law or interpretation. In particular, government agencies may make changes that could
reduce the profits that we can effectively realize from our non-U.S. operations. Like most U.S. companies, our effective
income tax rate reflects the fact that income earned and reinvested outside the U.S. is taxed at local rates, which are
often lower than U.S. tax rates. If changes in tax laws and regulations were to significantly increase the tax rates on
non-U.S. income, these changes could increase our income tax expense and liability, and therefore, could have an
adverse effect on our effective income tax rate, financial condition and results of operations.
Disruptions in the financial markets could have an adverse effect on our ability to raise additional financing.
Severe disruptions in the commercial credit markets in the recent past have resulted in a tightening of credit
markets worldwide. Liquidity in the global credit markets was severely contracted by these market disruptions, making
it difficult and costly to obtain new lines of credit or to refinance existing debt. The effect of these disruptions was
widespread and difficult to quantify. While economic conditions have recently improved, that trend may not continue
and the extent of the current economic improvement is unknown. Any future disruptions in the commercial credit
markets may impact liquidity in the global credit market as greatly, or even more, than in recent years.
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Our business and financing plan may be dependent upon the completion of future financings. If the credit
environment worsens, it may be difficult to obtain any additional financing on acceptable terms, which could have an
adverse effect on our ability to complete our remaining planned development projects, and as a consequence, our results
of operations and business plans. Should general economic conditions not improve, if we are unable to obtain sufficient
funding or applicable government approvals such that completion of our planned projects is not probable, or should
management decide to abandon certain projects, all or a portion of our investment to date in our planned projects could
be lost and would result in an impairment charge.
Natural or man-made disasters, an outbreak of highly infectious disease, terrorist activity or war could adversely
affect the number of visitors to our facilities and disrupt our operations, resulting in a material adverse effect
on our financial condition, results of operations or cash flows.
So called “Acts of God,” such as typhoons, particularly in Macao, and other natural disasters, man-made disasters,
outbreaks of highly infectious diseases, terrorist activity or war may result in decreases in travel to and from, and
economic activity in, areas in which we operate, and may adversely affect the number of visitors to our properties. Any
of these events also may disrupt our ability to staff our business adequately, could generally disrupt our operations and
could have a material adverse effect on our financial condition, results of operations or cash flows. Although we have
insurance coverage with respect to some of these events, we cannot assure you that any such coverage will be sufficient
to indemnify us fully against all direct and indirect costs, including any loss of business that could result from substantial
damage to, or partial or complete destruction of, any of our properties.
Our failure to maintain the integrity of our customer or company data could have a material adverse effect on
our results of operations and cash flows, and/or subject us to costs, fines or lawsuits.
We face global cybersecurity threats, which may range from uncoordinated individual attempts to sophisticated
and targeted measures directed at us. Cyber-attacks and security breaches may include, but are not limited to, attempts
to access information, including customer and company information, computer viruses, denial of service and other
electronic security breaches.
Our business requires the collection and retention of large volumes of customer data, including credit card numbers
and other personally identifiable information in various information systems that we maintain and in those maintained
by third-parties with whom we contract to provide data services. We also maintain important internal company data
such as personally identifiable information about our employees and information relating to our operations. The integrity
and protection of that customer and company data is important to us. Our collection of such customer and company
data is subject to extensive regulation by private groups such as the payment card industry as well as domestic and
foreign governmental authorities, including gaming authorities. Our systems may be unable to satisfy applicable
regulations or employee and customer expectations.
In addition, we have experienced a sophisticated criminal cybersecurity attack in the past, including a recent
breach of our information technology systems, referred to in “Item 3 — Legal Proceedings,” in which customer and
company information was compromised and certain company data may have been destroyed, and we may experience
additional cybersecurity attacks in the future, potentially with more frequency or sophistication. Our information systems
and records, including those we maintain with our third-party service providers, may be subject to cybersecurity
breaches, system failures, viruses, operator error or inadvertent releases of data. Our third-party information system
service providers face risks relating to cybersecurity similar to ours, and we do not directly control any of such parties’
information security operations. A significant theft, loss or fraudulent use of customer or company data maintained by
us or by a third-party service provider could have an adverse effect on our reputation, cause a material disruption to
our operations and management team, and result in remediation expenses, regulatory penalties and litigation by
customers and other parties whose information was subject to such attacks, all of which could have a material adverse
effect on our business, results of operations and cash flows.
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Risks Associated with Our International Operations
Conducting business in Macao and Singapore has certain political and economic risks, which may have an
adverse effect on the financial condition, results of operations or cash flows of our Asian operations.
Our operations in Macao include The Venetian Macao, Four Seasons Macao, Sands Cotai Central and Sands
Macao. We plan to open and operate additional hotels, gaming areas and meeting space within the Cotai Strip in Macao,
including The Parisian Macao, which is currently anticipated to open in 2016, subject to Macao government approval.
We also own and operate the Marina Bay Sands in Singapore. Accordingly, our business development plans, financial
condition, results of operations or cash flows may be materially and adversely affected by significant political, social
and economic developments in Macao and Singapore, and by changes in policies of the governments or changes in
laws and regulations or their interpretations. Our operations in Macao and Singapore are also exposed to the risk of
changes in laws and policies that govern operations of companies based in those countries. Jurisdictional tax laws and
regulations may also be subject to amendment or different interpretation and implementation, thereby having an adverse
effect on our profitability after tax. These changes may have a material adverse effect on our financial condition, results
of operations or cash flows.
As we expect a significant number of consumers to continue to come to our Macao properties from mainland
China, general economic conditions and policies in China could have a significant impact on our financial prospects.
Any slowdown in economic growth or changes to China’s current restrictions on travel and currency movements could
disrupt the number of visitors from mainland China to our casinos in Macao as well as the amounts they are willing to
spend in our casinos. See “— The number of visitors to Macao, particularly visitors from mainland China, may decline
or travel to Macao may be disrupted.”
Current Macao and Singapore laws and regulations concerning gaming and gaming concessions and licenses are,
for the most part, fairly recent and there is little precedent on the interpretation of these laws and regulations. We believe
that our organizational structure and operations are in compliance in all material respects with all applicable laws and
regulations of Macao and Singapore. These laws and regulations are complex and a court or an administrative or
regulatory body may in the future render an interpretation of these laws and regulations, or issue regulations, which
differs from our interpretation and could have a material adverse effect on our financial condition, results of operations
or cash flows.
In addition, our activities in Macao and Singapore are subject to administrative review and approval by various
government agencies. We cannot assure you that we will be able to obtain all necessary approvals, which may have a
material adverse effect on our long-term business strategy and operations. Macao and Singapore laws permit redress
to the courts with respect to administrative actions; however, such redress is largely untested in relation to gaming
issues.
Recently, the Macao government approved smoking control legislation, which prohibits smoking in casinos
starting on October 6, 2014. The legislation, however, permits casinos to maintain designated smoking areas of up to
50% of the areas opened to the public, so long as such areas are within restricted access areas and comply with the
conditions set out in the Dispatch of the Chief Executive, dated November 1, 2012, as amended by the Dispatch of the
Chief Executive, dated June 3, 2014. The implementation of such legislation may deter potential gaming customers
who are smokers from frequenting casinos in jurisdictions with smoking bans such as Macao. Such laws and regulations
could change or could be interpreted differently in the future. We cannot predict the future likelihood or outcome of
similar legislation or referendums in other jurisdictions where we operate or the magnitude of any decrease in revenues
as a result of such regulations, though any smoking ban could have an adverse effect on our business, financial condition,
results of operations or cash flows.
We are currently required to build and open The Parisian Macao by April 2016 and complete Sands Cotai Central
by December 2016. If we are unable to meet the respective deadlines and the deadlines for either development
are not extended, we may lose the respective land concession, which would prohibit us from operating any facilities
developed under such land concession.
We received land concessions from the Macao government covering the sites on which The Venetian Macao,
Four Seasons Macao and Sands Cotai Central are located and The Parisian Macao is being constructed. The Macao
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government granted us two extensions of the development deadline under the land concession for The Parisian Macao.
Under the terms of the land concession, we must complete The Parisian Macao by April 2016. See “— Risks Related
to Our Business — Disruptions in the financial markets could have an adverse effect on our ability to raise additional
financing,” “— Risks Related to Our Business — There are significant risks associated with our ongoing and future
construction projects, which could have an adverse effect on our financial condition, results of operations or cash flows
from these planned facilities” and “— Conducting business in Macao and Singapore has certain political and economic
risks, which may have an adverse effect on the financial condition, results of operations or cash flows of our Asian
operations.” The land concession for Sands Cotai Central contains a similar requirement that the corresponding
development be completed by December 2016. Should we determine that we are unable to complete The Parisian
Macao or Sands Cotai Central by their respective deadlines, we would expect to apply for an extension from the Macao
government. No assurance can be given that additional extensions will be granted. If we are unable to meet the current
deadlines and the deadlines for either development are not extended, the Macao government has the right to unilaterally
terminate our respective land concessions for The Parisian Macao or Sands Cotai Central. A loss of the land concession
would prohibit us from operating any properties developed under the land concession for The Parisian Macao or Sands
Cotai Central. As a result, we could record a charge for all or some portion of our $804.3 million and $4.47 billion in
capitalized costs and land premiums (net of amortization), as of December 31, 2014, for The Parisian Macao or Sands
Cotai Central, respectively.
Our Macao subconcession can be terminated under certain circumstances without compensation to us, which
would have a material adverse effect on our business, financial condition, results of operations or cash flows.
The Macao government has the right, after consultation with Galaxy, to unilaterally terminate our subconcession
in the event of VML’s serious non-compliance with its basic obligations under the subconcession and applicable Macao
laws. Upon termination of our subconcession, our casinos and gaming-related equipment would automatically be
transferred to the Macao government without compensation to us and we would cease to generate any revenues from
these operations. The loss of our subconcession would prohibit us from conducting gaming operations in Macao, which
would have a material adverse effect on our business, financial condition, results of operations or cash flows.
Our Singapore concession can be terminated under certain circumstances without compensation to us, which
would have a material adverse effect on our business, financial condition, results of operations or cash flows.
The Development Agreement between MBS and the STB contains events of default that could permit the STB
to terminate the agreement without compensation to us. If the Development Agreement is terminated, we could lose
our right to operate the Marina Bay Sands and our investment in Marina Bay Sands could be lost.
For a more complete description of the Singapore gaming regulatory requirements applicable to beneficial owners
of our voting securities, see “Item 1 — Business — Regulation and Licensing — Development Agreement with
Singapore Tourism Board.”
We will stop generating any revenues from our Macao gaming operations if we cannot secure an extension of
our subconcession in 2022 or if the Macao government exercises its redemption right.
Our subconcession agreement expires on June 26, 2022. Unless our subconcession is extended, all of VML’s
casino premises and gaming-related equipment will be transferred automatically to the Macao government on that date
without compensation to us and we will cease to generate revenues from these gaming operations. Beginning on
December 26, 2017, the Macao government may redeem the subconcession agreement by providing us at least one
year prior notice. In the event the Macao government exercises this redemption right, we are entitled to fair compensation
or indemnity. The amount of this compensation or indemnity will be determined based on the amount of gaming and
non-gaming revenue generated by The Venetian Macao during the tax year prior to the redemption multiplied by the
number of remaining years before expiration of the subconcession. We cannot assure you that we will be able to renew
or extend our subconcession agreement on terms favorable to us or at all. We also cannot assure you that if our
subconcession is redeemed, the compensation paid will be adequate to compensate us for the loss of future revenues.
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The number of visitors to Macao, particularly visitors from mainland China, may decline or travel to Macao
may be disrupted.
Our VIP and mass market gaming customers typically come from nearby destinations in Asia, including mainland
China, Hong Kong, South Korea and Japan. Increasingly, a significant number of gaming customers come to our casinos
from mainland China. Any slowdown in economic growth or changes of China’s current restrictions on travel and
currency movements could disrupt the number of visitors from mainland China to our casinos in Macao as well as the
amounts they are willing and able to spend while at our properties.
Policies and measures adopted from time to time by the Chinese government include restrictions imposed on exit
visas granted to residents of mainland China for travel to Macao and Hong Kong. These measures have, and any future
policy developments that may be implemented may have, the effect of reducing the number of visitors to Macao from
mainland China, which could adversely impact tourism and the gaming industry in Macao.
Our Macao operations face intense competition, which could have a material adverse effect on our financial
condition, results of operations or cash flows.
The hotel, resort and casino businesses are highly competitive. Our Macao operations currently compete with
numerous other casinos located in Macao. Our Macao operations will also compete to some extent with casinos located
elsewhere in Asia, including Singapore, Philippines, Korea, Australia, New Zealand and elsewhere in the world,
including Las Vegas. In addition, certain countries have legalized, and others may in the future legalize, casino gaming,
including Japan, Taiwan and Thailand.
The proliferation of gaming venues, especially in Southeast Asia, could have a significant and adverse effect on
our financial condition, results of operations or cash flows.
The Macao and Singapore governments could grant additional rights to conduct gaming in the future, which
could have a material adverse effect on our financial condition, results of operations or cash flows.
We hold a subconcession under one of only three gaming concessions authorized by the Macao government to
operate casinos in Macao. No additional concessions have been granted since 2002; however, if the Macao government
were to allow additional gaming operators in Macao through the grant of additional concessions or subconcessions,
we would face additional competition, which could have a material adverse effect on our financial condition, results
of operations or cash flows.
We hold one of two licenses granted by the Singapore government to develop an integrated resort, including a
casino. Under the Request for Proposal, the CRA is required to ensure that there will not be more than two casino
licenses during a ten-year exclusive period that began on March 1, 2007. If the Singapore government were to license
additional casinos, we would face additional competition, which could have a material adverse effect on our financial
condition, results of operations or cash flows.
We may not be able to attract and retain professional staff necessary for our existing and future operations in
Macao and Singapore.
Our success depends in large part upon our ability to attract, retain, train, manage and motivate skilled employees
at our properties. In addition, the Macao government requires that we only hire Macao residents as dealers in our
casinos. There is significant competition in Macao and Singapore for employees with the skills required to perform the
services we offer and competition for these individuals in Macao is likely to increase as we open the remaining phase
of Sands Cotai Central and The Parisian Macao, and as other competitors expand their operations. There can be no
assurance that a sufficient number of construction labor and skilled employees will be available or that we will be
successful in training, retaining and motivating current or future employees. If we are unable to obtain, attract, retain
and train skilled employees, our ability to adequately manage and staff our existing and planned casino and resort
properties in Macao and Singapore could be impaired, which could have a material adverse effect on our business,
financial condition, results of operations or cash flows.
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We are dependent upon gaming junket operators for a significant portion of our gaming revenues in Macao.
Junket operators, which promote gaming and draw high-roller customers to casinos, are responsible for a
significant portion of our gaming revenues in Macao. With the rise in gaming in Macao, the competition for relationships
with junket operators has increased. There can be no assurance that we will be able to maintain, or grow, our relationships
with junket operators. If we are unable to maintain or grow our relationships with junket operators, or if the junket
operators experience financial difficulties or are unable to develop or maintain relationships with our high-roller
customers, our ability to grow our gaming revenues will be hampered.
If junket operators attempt to negotiate changes to our operational agreements, including higher commissions,
it could result in higher costs for us, loss of business to a competitor or loss of relationships with junket operators, any
of which could have a material adverse effect on our business, financial condition, results of operations or cash flows.
In addition, the quality of junket operators is important to our reputation and our ability to continue to operate
in compliance with our gaming licenses. While we strive for excellence in our associations with junket operators, we
cannot assure you that the junket operators with whom we are associated will meet the high standards we insist upon.
If a junket operator falls below our standards, we may suffer reputational harm, as well as worsening relationships with,
and possible sanctions from, gaming regulators with authority over our operations.
Our business could be adversely affected by the limitations of the pataca exchange markets and restrictions on
the export of the renminbi.
Our revenues in Macao are denominated in patacas, the legal currency of Macao, and Hong Kong dollars. The
Macao pataca and the Hong Kong dollar are linked to each other and, in many cases, are used interchangeably in Macao.
Although currently permitted, we cannot assure you that patacas will continue to be freely exchangeable into U.S.
dollars. Also, because the currency market for patacas is relatively small and undeveloped, our ability to convert large
amounts of patacas into U.S. dollars over a relatively short period may be limited. As a result, we may experience
difficulty in converting patacas into U.S. dollars.
We are currently prohibited from accepting wagers in renminbi, the legal currency of China. There are also
restrictions on the export of the renminbi outside of mainland China and the amount of renminbi that can be converted
into foreign currencies, including the pataca and Hong Kong dollar. Restrictions on the export of the renminbi may
impede the flow of gaming customers from mainland China to Macao, inhibit the growth of gaming in Macao and
negatively impact our gaming operations.
On July 21, 2005, the People’s Bank of China announced that the renminbi will no longer be pegged to the U.S.
dollar, but will be allowed to float in a band (and, to a limited extent, increase in value) against a basket of foreign
currencies. The Macao pataca is pegged to the Hong Kong dollar. Certain Asian countries have publicly asserted their
desire to eliminate the peg of the Hong Kong dollar to the U.S. dollar. As a result, we cannot assure you that the Hong
Kong dollar and the Macao pataca will continue to be pegged to the U.S. dollar or that the current peg rate for these
currencies will remain at the same level. The floating of the renminbi and possible changes to the peg of the Hong
Kong dollar may result in severe fluctuations in the exchange rate for these currencies. Any change in such exchange
rates could have a material adverse effect on our operations and on our ability to make payments on certain of our debt
instruments. We do not currently hedge for foreign currency risk; however, we maintain a significant amount of our
operating funds in the same currencies in which we have obligations, thereby reducing our exposure to currency
fluctuations.
Certain Nevada gaming laws apply to our gaming activities and associations in other jurisdictions where we
operate or plan to operate.
Certain Nevada gaming laws also apply to our gaming activities and associations in jurisdictions outside the State
of Nevada. We are required to comply with certain reporting requirements concerning our proposed gaming activities
and associations occurring outside the State of Nevada, including Macao, Singapore and other jurisdictions. We will
also be subject to disciplinary action by the Nevada Commission if:
• we knowingly violate any laws of the foreign jurisdiction pertaining to the foreign gaming operation;
33
• we fail to conduct the foreign gaming operation in accordance with the standards of honesty and integrity
required of Nevada gaming operations;
• we engage in any activity or enter into any association that is unsuitable for us because it poses an unreasonable
threat to the control of gaming in Nevada, reflects or tends to reflect discredit or disrepute upon the State of
Nevada or gaming in Nevada, or is contrary to the gaming policies of Nevada;
• we engage in any activity or enter into any association that interferes with the ability of the State of Nevada to
collect gaming taxes and fees; or
• we employ, contract with or associate with any person in the foreign gaming operation who has been denied a
license or a finding of suitability in Nevada on the ground of personal unsuitability, or who has been found
guilty of cheating at gambling.
Also, as we are required to provide any other information that the Nevada Commission may require concerning
our gaming activities and associations in jurisdictions outside the State of Nevada, we could be subject to disciplinary
action by the Nevada Commission if our current reporting is determined to be unsatisfactory due to Macao regulations
regarding personal data protection prohibiting us from satisfying certain reporting requirements of the Nevada
Commission.
In addition, if the Nevada Board determines that one of our actual or intended activities or associations in a foreign
gaming operation may violate one or more of the foregoing, we can be required to file an application with the Nevada
Commission for a finding of suitability of such activity or association. If the Nevada Commission finds that the activity
or association in the foreign gaming operation is unsuitable or prohibited, we will either be required to terminate the
activity or association, or will be prohibited from undertaking the activity or association. Consequently, should the
Nevada Commission find that our gaming activities or associations in Macao or certain other jurisdictions where we
operate are unsuitable, we may be prohibited from undertaking our planned gaming activities or associations in those
jurisdictions.
The gaming authorities in other jurisdictions where we operate or plan to operate, including in Macao and
Singapore, exercise similar powers for purposes of assessing suitability in relation to our activities in other gaming
jurisdictions where we do business.
We may not be able to monetize some of our real estate assets.
Part of our business strategy in Macao and Singapore relies upon our ability to profitably operate, sell and/or
grant rights of use over certain of our real estate assets once developed, including retail malls and apart-hotels. Our
ability to monetize these assets will be subject to market conditions, applicable legislation, the receipt of necessary
government approvals and other factors. If we are unable to profitably operate and/or monetize these real estate assets,
it may have an adverse effect on our financial condition, results of operations or cash flows.
VML may have financial and other obligations to foreign workers managed by its contractors under government
labor quotas.
The Macao government has granted VML a quota to permit it to hire foreign workers. VML has effectively
assigned the management of this quota to its contractors for the construction of our Cotai Strip projects. VML, however,
remains ultimately liable for all employer obligations relating to these employees, including for payment of wages and
taxes and compliance with labor and workers’ compensation laws. VML requires each contractor to whom it has assigned
the management of part of its labor quota to indemnify VML for any costs or liabilities VML incurs as a result of such
contractor’s failure to fulfill employer obligations. VML’s agreements with its contractors also contain provisions that
permit it to retain some payments for up to one year after the contractors’ complete work on the projects. We cannot
assure you that VML’s contractors will fulfill their obligations to employees hired under the labor quotas or to VML
under the indemnification agreements, or that the amount of any indemnification payments received will be sufficient
to pay for any obligations VML may owe to employees managed by contractors under VML’s quotas. Until we make
final payments to our contractors, we have offset rights to collect amounts they may owe us, including amounts owed
under the indemnities relating to employer obligations. After we have made the final payments, it may be more difficult
for us to enforce any unpaid indemnity obligations.
34
The transportation infrastructure in Macao may need to be expanded to meet increased visitation in Macao.
Macao is in the process of expanding its transportation infrastructure to service the increased number of visitors
to Macao. If the planned expansions of transportation facilities to and from Macao are delayed or not completed, and
Macao’s transportation infrastructure is insufficient to meet the demands of an increased volume of visitors to Macao,
the desirability of Macao as a business and leisure tourism destination, as well as the results of operations of our Macao
properties, could be negatively impacted.
We are currently not required to pay corporate income taxes on our casino gaming operations in Macao.
Additionally, we currently have an agreement with the Macao government that provides for a fixed annual
payment that is a substitution for a 12% tax otherwise due from VML’s shareholders on dividends distributed
from our Macao gaming operations. These tax arrangements expire at the end of 2018.
We have had the benefit of a corporate tax exemption in Macao, which exempts us from paying the 12% corporate
income tax on profits generated by the operation of casino games. This exemption does not apply to our non-gaming
activities. We will continue to benefit from this tax exemption through the end of 2018. Additionally, we entered into
an agreement with the Macao government in May 2014, effective through the end of 2018 that provides for an annual
payment that is a substitution for a 12% tax otherwise due from VML shareholders on dividend distributions paid from
VML gaming profits. We intend to request five-year extensions of these tax arrangements; however, we cannot assure
you that either of these tax arrangements will be extended beyond their expiration dates.
Risks Associated with Our U.S. Operations
We face significant competition in Las Vegas, which could have a material adverse effect on our financial
condition, results of operations or cash flows. In addition, any significant downturn in the trade show and
convention business could have a significant and adverse effect on our mid-week occupancy rates and business.
The hotel, resort and casino businesses in Las Vegas are highly competitive. We also compete, to some extent,
with other hotel/casino facilities in Nevada and Atlantic City, as well as hotel/casinos and other resort facilities and
vacation destinations elsewhere in the United States and around the world. In addition, various competitors on the Las
Vegas Strip periodically expand and/or renovate their existing facilities. If demand for hotel rooms does not keep up
with the increase in the number of hotel rooms, competitive pressures may cause reductions in average room rates.
We also compete with legalized gaming from casinos located on Native American tribal lands, including those
located in California. While the competitive impact on our operations in Las Vegas from the continued growth of Native
American gaming establishments in California remains uncertain, the proliferation of gaming in California and other
areas located in the same region as our Las Vegas Operating Properties could have an adverse effect on our results of
operations.
In addition, certain states have legalized, and others may legalize, casino gaming in specific areas, including
metropolitan areas from which we traditionally attract customers. A number of states have permitted or are considering
permitting gaming at “racinos” (combined race tracks and casinos), on Native American reservations and through
expansion of state lotteries.
Certain states within the U.S. have also legalized, and others in the future may legalize, online gaming. There
are a number of established, well capitalized companies producing and operating online gaming offerings that compete
with us. Online gaming is a new and evolving industry and is potentially subject to significant future development,
including legal and regulatory development.
The current global trend toward liberalization of gaming restrictions and resulting proliferation of gaming venues
could result in a decrease in the number of visitors to our Las Vegas facilities by attracting customers close to home
and away from Las Vegas, which could have an adverse effect on our financial condition, results of operations or cash
flows. Also, on December 23, 2011, the DOJ released an opinion on the application of the Wire Act to interstate
transmission of wire communications, concluding that such communications that did not relate to a “sporting event or
contest” fell outside the prohibition of the Wire Act. In concluding as such, the DOJ reversed earlier opinions that the
Wire Act was not limited to such communications on sporting events or contests. Those states that permit these
35
distribution channels may also expand the gaming offerings of their lotteries in a manner that could have an adverse
effect on our business.
The Sands Expo Center provides recurring demand for mid-week room nights for business travelers who attend
meetings, trade shows and conventions in Las Vegas. The Sands Expo Center presently competes with other large
convention centers, including convention centers in Las Vegas and other cities. To the extent that these competitors are
able to capture a substantially larger portion of the trade show and convention business, there could be a material adverse
effect on our financial condition, results of operations or cash flows.
Certain beneficial owners of our voting securities may be required to file an application with, and be investigated
by, the Nevada Gaming Authorities, and the Nevada Commission may restrict the ability of a beneficial owner
to receive any benefit from our voting securities and may require the disposition of shares of our voting securities,
if a beneficial owner is found to be unsuitable.
Any person who acquires beneficial ownership of more than 10% of our voting securities will be required to
apply to the Nevada Commission for a finding of suitability within thirty days after the Chairman of the Nevada Board
mails a written notice requiring the filing. Under certain circumstances, an “institutional investor” as defined under the
regulations of the Nevada Commission, which acquires beneficial ownership of more than 10%, but not more than
25%, of our voting securities (subject to certain additional holdings as a result of certain debt restructurings or stock
repurchase programs under the Nevada Act), may apply to the Nevada Commission for a waiver of such finding of
suitability requirement if the institutional investor holds our voting securities only for investment purposes. In addition,
any beneficial owner of our voting securities, regardless of the number of shares beneficially owned, may be required
at the discretion of the Nevada Commission to file an application for a finding of suitability as such. In either case, a
finding of suitability is comparable to licensing and the applicant must pay all costs of investigation incurred by the
Nevada Gaming Authorities in conducting the 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 Gaming Authorities may be found unsuitable. The same restrictions apply to a record
owner if the record owner, after request, fails to identify the beneficial owner. Any stockholder found unsuitable 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. We are subject to
disciplinary action if, after we receive notice that a person is unsuitable to be a stockholder or to have any other
relationship with us or a licensed subsidiary, we, or any of the licensed subsidiaries:
•
•
•
allow that person to exercise, directly or indirectly, any voting right conferred through securities held by that
person;
pay remuneration in any form to that person for services rendered or otherwise; or
fail to pursue all lawful efforts to require such unsuitable person to relinquish his or her voting securities
including, if necessary, purchasing them for cash at fair market value.
For a more complete description of the Nevada gaming regulatory requirements applicable to beneficial owners
of our voting securities, see “Item 1 — Business — Regulation and Licensing — State of Nevada.”
Certain beneficial owners of our voting securities may be required to file a license application with, and be
investigated by, the Pennsylvania Gaming Control Board, the Pennsylvania State Police and other agencies.
Any person who acquires beneficial ownership of 5% or more of our voting securities will be required to apply
to the PaGCB for licensure, obtain licensure and remain licensed. Licensure requires, among other things, that the
applicant establish by clear and convincing evidence the applicant’s good character, honesty and integrity. Additionally,
any trust that holds 5% or more of our voting securities is required to be licensed by the PaGCB and each individual
who is a grantor, trustee or beneficiary of the trust is also required to be licensed by the PaGCB. Under certain
circumstances and under the regulations of the PaGCB, an “institutional investor” as defined under the regulations of
the PaGCB, which acquires beneficial ownership of 5% or more, but less than 10%, of our voting securities, may not
be required to be licensed by the PaGCB provided the PaGCB grants a waiver of the licensure requirement. In addition,
36
any beneficial owner of our voting securities, regardless of the number of shares beneficially owned, may be required
at the discretion of the PaGCB to file an application for licensure.
Furthermore, a person or a group of persons acting in concert who acquire(s) more than 20% of our securities,
with the exception of the ownership interest of a person at the time of original licensure when the license fee was paid,
would trigger a “change in control” (as defined under applicable law). Such a change in control could require us to re-
apply for licensure by the PaGCB and incur a $50.0 million license fee.
In the event a security holder is required to be found qualified and is not found qualified, or fails to apply for
qualification, such security holder may be required by the PaGCB to divest of the interest at a price not exceeding the
cost of the interest.
For a more complete description of the Pennsylvania gaming regulatory requirements applicable to beneficial
owners of our voting securities, see “Item 1 — Business — Regulation and Licensing — Commonwealth of
Pennsylvania.”
If GGP (or any future owner of the Grand Canal Shoppes) breaches any of its material agreements with us or
if we are unable to maintain an acceptable working relationship with GGP (or any future owner), there could
be a material adverse effect on our financial condition, results of operations or cash flows.
We have entered into agreements with GGP under which, among other things, GGP has agreed to operate the
Grand Canal Shoppes subject to, and in accordance with, the cooperation agreement. Our agreements with GGP could
be adversely affected in ways that could have a material adverse effect on our financial condition, results of operations
or cash flows if we do not maintain an acceptable working relationship with GGP or its successors. For example, the
cooperation agreement that governs the relationships between the Grand Canal Shoppes and The Palazzo and The
Venetian Las Vegas requires that the owners cooperate in various ways and take various joint actions, which will be
more difficult to accomplish, especially in a cost-effective manner, if the parties do not have an acceptable working
relationship.
There could be similar material adverse consequences to us if GGP breaches any of its agreements with us, such
as its agreement under the cooperation agreement to operate the Grand Canal Shoppes consistent with the standards of
first-class restaurant and retail complexes and the overall Venetian theme in the section formerly referred to as The
Grand Canal Shoppes, and its various obligations as our landlord under the leases described above. Although our
agreements with GGP provide us with various remedies in the event of any breaches by GGP and include various
dispute resolution procedures and mechanisms, these remedies, procedures and mechanisms may be inadequate to
prevent a material adverse effect on our financial condition, results of operations or cash flows if breaches by GGP
occur or if we do not maintain an acceptable working relationship with GGP.
ITEM 1B. — UNRESOLVED STAFF COMMENTS
None.
ITEM 2. — PROPERTIES
We have received concessions from the Macao government to build on a six-acre land site for the Sands Macao
and the sites on which The Venetian Macao, Four Seasons Macao and Sands Cotai Central are, and The Parisian Macao
will be, located. We do not own these land sites in Macao; however, the land concessions grant us exclusive use of the
land. Land concessions in Macao generally have an initial term of 25 years with automatic extensions of 10 years
thereafter in accordance with Macao law. As specified in the land concessions, we are required to pay premiums, which
are either payable in a single lump sum upon acceptance of our land concessions by the Macao government or in seven
semi-annual installments, as well as annual rent for the term of the land concession, which may be revised every five
years by the Macao government. In October 2008, the Macao government amended our land concession to separate
the retail and hotel portions of the Four Seasons Macao parcel and allowed us to subdivide the parcel into four separate
components, consisting of retail, hotel/casino, Four Seasons Apartments and parking areas. In consideration for the
amendment, we paid an additional land premium of approximately $17.8 million and will pay adjusted annual rent
over the remaining term of the concession, which increased slightly due to the revised allocation of parcel use. See
37
“Item 8 — Financial Statements and Supplementary Data — Notes to Consolidated Financial Statements — Note 5
— Leasehold Interests in Land, Net” for more information on our payment obligation under these land concessions.
Under our land concession for The Parisian Macao, we are required to complete the development by April 2016.
The land concession for Sands Cotai Central contains a similar requirement, which was extended by the Macao
government in April 2014, that the development be completed by December 2016. Should we determine that we are
unable to complete The Parisian Macao or Sands Cotai Central by their respective deadlines, we would expect to apply
for another extension from the Macao government. If we are unable to meet the current deadlines and the deadlines
for either development are not extended, we could lose our land concessions for The Parisian Macao or Sands Cotai
Central, which would prohibit us from operating any facilities developed under the respective land concessions. As a
result, we could record a charge for all or some portion of the $804.3 million or $4.47 billion in capitalized construction
costs, as of December 31, 2014, related to The Parisian Macao or Sands Cotai Central, respectively.
Under the Development Agreement with the STB, we paid SGD 1.2 billion (approximately $907.2 million at
exchange rates in effect on December 31, 2014) in premium payments for the 60-year lease of the land on which the
Marina Bay Sands is located plus an additional SGD 105.6 million (approximately $79.8 million at exchange rates in
effect on December 31, 2014) for various taxes and other fees.
We own an approximately 63-acre parcel of land on which our Las Vegas Operating Properties are located and
an approximately 19-acre parcel of land located to the east of the 63-acre parcel. We own these parcels of land in fee
simple, subject to certain easements, encroachments and other non-monetary encumbrances. LVSLLC’s credit facility,
subject to certain exceptions, is collateralized by a first priority security interest (subject to permitted liens) in
substantially all of LVSLLC’s property.
The Sands Bethlehem resort is located on the site of the historic Bethlehem Steel Works in Bethlehem,
Pennsylvania, which is about 70 miles from midtown Manhattan, New York. In September 2008, our joint venture
partner, Bethworks Now, LLC, contributed the land on which Sands Bethlehem is being developed to Sands Bethworks
Gaming and Sands Bethworks Retail, a portion of which was contributed through a condominium form of ownership.
In March 2004, we entered into a long-term lease with a third party for the airspace over which a portion of The
Shoppes at The Palazzo was constructed (the “Leased Airspace”). We acquired fee title from the same third party to
the airspace above the Leased Airspace (the “Acquired Airspace”) in order to build the Las Vegas Condo Tower in
January 2008. In February 2008, in connection with the sale of The Shoppes at The Palazzo, GGP acquired control of
the Leased Airspace. We continue to retain fee title to the Acquired Airspace in order to resume building the Las Vegas
Condo Tower when market conditions improve.
ITEM 3. — LEGAL PROCEEDINGS
In addition to the matters described at “Item 8 — Financial Statements and Supplementary Data — Notes to
Consolidated Financial Statements — Note 13 — Commitments and Contingencies — Litigation,” we are party to
various legal matters and claims arising in the ordinary course of business. Management has made certain estimates
for potential litigation costs based upon consultation with legal counsel. Actual results could differ from these estimates;
however, in the opinion of management, such litigation and claims will not have a material adverse effect on our
financial condition, results of operations or cash flows.
ITEM 4. — MINE SAFETY DISCLOSURES
Not applicable.
38
PART II
ITEM 5. — MARKET FOR REGISTRANT’S COMMON EQUITY, RELATED STOCKHOLDER MATTERS
AND ISSUER PURCHASES OF EQUITY SECURITIES
Market Information
The Company’s common stock trades on the NYSE under the symbol “LVS.” The following table sets forth the
high and low sales prices for the common stock on the NYSE for the fiscal quarter indicated:
2013
First Quarter .............................................................................................................. $
Second Quarter.......................................................................................................... $
Third Quarter............................................................................................................. $
Fourth Quarter........................................................................................................... $
2014
First Quarter .............................................................................................................. $
Second Quarter.......................................................................................................... $
Third Quarter............................................................................................................. $
Fourth Quarter........................................................................................................... $
2015
First Quarter (through February 24, 2015)................................................................ $
High
Low
56.83
60.54
67.35
79.25
88.28
84.24
78.50
65.83
61.59
$
$
$
$
$
$
$
$
$
47.99
47.95
50.67
63.49
69.15
71.09
59.08
49.82
52.28
As of February 24, 2015, there were 798,510,417 shares of our common stock outstanding that were held by 403
stockholders of record.
Dividends
Our ability to declare and pay dividends on our common stock is subject to the requirements of Nevada law. In
addition, we are a parent company with limited business operations of our own. Accordingly, our primary sources of
cash are dividends and distributions with respect to our ownership interest in our subsidiaries that are derived from the
earnings and cash flow generated by our operating properties.
Our subsidiaries’ long-term debt arrangements place restrictions on their ability to pay cash dividends to the
Company. This may restrict our ability to pay cash dividends other than from cash on hand. See “Item 7 — Management’s
Discussion and Analysis of Financial Condition and Results of Operations — Restrictions on Distributions” and “Item 8
— Financial Statements and Supplementary Data — Notes to Consolidated Financial Statements — Note 8 — Long-
Term Debt.”
Common Stock Dividends
On March 31, June 30, September 30 and December 29, 2014, we paid a dividend of $0.50 per common share
as part of a regular cash dividend program. During the year ended December 31, 2014, we recorded $1.61 billion as a
distribution against retained earnings (of which $863.3 million related to our Principal Stockholder’s family and the
remaining $744.8 million related to all other stockholders).
On March 29, June 28, September 27 and December 31, 2013, we paid a dividend of $0.35 per common share
as part of a regular cash dividend program. During the year ended December 31, 2013, we recorded $1.15 billion as a
distribution against retained earnings (of which $604.2 million related to our Principal Stockholder’s family and the
remaining $548.9 million related to all other stockholders).
In January 2015, our Board of Directors declared a quarterly dividend of $0.65 per common share (a total estimated
to be approximately $519 million) to be paid on March 31, 2015, to shareholders of record on March 23, 2015. We
expect this level of dividend to continue quarterly through the remainder of 2015. Our Board of Directors will continually
assess the level and appropriateness of any cash dividends.
39
Recent Sales of Unregistered Securities
There have not been any sales by the Company of equity securities in the last fiscal year that have not been
registered under the Securities Act of 1933.
Purchases of Equity Securities by the Issuer
The following table provides information about share repurchases we made of our common stock during the
quarter ended December 31, 2014:
Period
October 1, 2014 - October 31, 2014 .........
November 1, 2014 - November 30, 2014 .
December 1, 2014 - December 31, 2014 ..
Total
Number
of Shares
Purchased(1)
Weighted
Average
Price Paid
Per Share(2)
— $
$
$
1,996,018
1,890,585
—
62.63
59.52
Total Number
of Shares
Purchased as
Part of a Publicly
Announced Program
— $
$
$
1,996,018
1,845,365
Approximate
Dollar Value of
Shares that May
Yet Be Purchased
Under the Program
(in thousands)(3)
2,000,017
1,875,000
1,765,001
(1) During December 2014, we repurchased 45,220 shares of our common stock in satisfaction of tax withholding
and exercise price obligations on vested restricted stock and a stock option exercise. These shares were not
considered part of the stock repurchase program.
(2) Calculated excluding commissions.
(3)
In June 2013, our Board of Directors announced a stock repurchase program with an initial authorization of $2.0
billion, which expires on June 5, 2015, but was completed during the year ended December 31, 2014. In October
2014, our Board of Directors authorized the repurchase of an additional $2.0 billion of our outstanding common
stock, which expires on October 9, 2016. All repurchases under the stock repurchase program are made from
time to time at our discretion in accordance with applicable federal securities laws. All share repurchases of our
common stock have been recorded as treasury shares.
40
Performance Graph
The following performance graph compares the performance of our common stock with the performance of the
Standard & Poor’s 500 Index and the Dow Jones US Gambling Index, during the five years ended December 31, 2014.
The graph plots the changes in value of an initial $100 investment over the indicated time period, assuming all dividends
are reinvested. The stock price performance in this graph is not necessarily indicative of future stock price performance.
Las Vegas Sands Corp. ................... $
S&P 500.......................................... $
Dow Jones US Gambling Index ..... $
12/31/2009
100.00
100.00
100.00
12/31/2010
307.56
$
115.06
$
173.11
$
Cumulative Total Return
12/31/2012
12/31/2011
335.21
$
286.01
$
136.30
$
117.49
$
177.84
$
160.92
$
12/31/2013
585.85
$
180.44
$
305.42
$
12/31/2014
445.17
$
205.14
$
247.97
$
The performance graph should not be deemed filed or incorporated by reference into any other Company filing
under the Securities Act of 1933 or the Exchange Act of 1934, except to the extent the Company specifically incorporates
the performance graph by reference therein.
41
ITEM 6. — SELECTED FINANCIAL DATA
The following reflects selected historical financial data that should be read in conjunction with “Item 7 —
Management’s Discussion and Analysis of Financial Condition and Results of Operations” and the consolidated financial
statements and notes thereto included elsewhere in this Annual Report on Form 10-K. The historical results are not
necessarily indicative of the results of operations to be expected in the future.
(1)(2)
2014
(3)(4)(5)
2013
(6)(7)(8)
2012
(9)
2011
(10)
2010
Year Ended December 31,
(In thousands, except per share data)
STATEMENT OF OPERATIONS
DATA
Gross revenues ................................. $ 15,425,788
(841,939)
Less — promotional allowances ......
14,583,849
Net revenues .....................................
10,484,623
Operating expenses ..........................
4,099,226
Operating income .............................
(248,538)
Interest, net .......................................
1,965
Other income (expense) ...................
Loss on modification or early
retirement of debt ...........................
Income before income taxes.............
Income tax expense ..........................
Net income .......................................
Net income attributable to
noncontrolling interests ..................
Net income attributable to Las
Vegas Sands Corp...........................
Preferred stock dividends .................
Accretion to redemption value of
preferred stock issued to Principal
Stockholder’s family ......................
Preferred stock inducement,
repurchase and redemption
premiums........................................
Net income attributable to common
stockholders.................................... $ 2,840,629
Per share data:
(19,942)
3,832,711
(244,640)
3,588,071
2,840,629
—
(747,442)
—
—
Basic earnings per share............ $
Diluted earnings per share......... $
3.52
3.52
Cash dividends declared per
common share ................................ $
OTHER DATA
Capital expenditures ......................... $ 1,178,656
2.00
$
$
$
$
$ 14,494,436
(724,551)
13,769,885
10,361,642
3,408,243
(254,874)
4,321
$ 11,684,669
(553,537)
11,131,132
8,819,750
2,311,382
(235,312)
5,740
$ 9,862,334
(451,589)
9,410,745
7,020,858
2,389,887
(268,555)
(3,955)
$ 7,317,937
(464,755)
6,853,182
5,672,596
1,180,586
(297,866)
(8,260)
(14,178)
3,143,512
(188,836)
2,954,676
(19,234)
2,062,576
(180,763)
1,881,813
(22,554)
2,094,823
(211,704)
1,883,119
(18,555)
855,905
(74,302)
781,603
(648,679)
(357,720)
(322,996)
(182,209)
2,305,997
—
1,524,093
—
1,560,123
(63,924)
599,394
(92,807)
—
—
—
—
(80,975)
(92,545)
(145,716)
(6,579)
$ 2,305,997
$ 1,524,093
$ 1,269,508
2.80
2.79
1.40
$
$
$
1.89
1.85
3.75
$
$
$
$
$
$
1.74
1.56
— $
407,463
0.61
0.51
—
898,111
$ 1,449,234
$ 1,508,493
$ 2,023,981
(1)
2014
(4)
2013
December 31,
(8)
2012
(In thousands)
(9)
2011
2010
BALANCE SHEET DATA
Total assets ....................................... $ 22,361,691
Long-term debt ................................. $ 9,892,913
Preferred stock issued to Principal
Stockholder’s family ...................... $
Total Las Vegas Sands Corp.
stockholders’ equity........................ $ 7,213,586
_________________________
$ 22,724,264
$ 9,382,752
$ 22,163,652
$ 10,132,265
$ 22,244,123
$ 9,577,131
$ 21,044,308
$ 9,373,755
— $
— $
— $
— $
503,379
$ 7,665,494
$ 7,061,842
$ 7,850,689
$ 6,662,991
(1) During the year ended December 31, 2014, we paid a quarterly dividend of $0.50 per common share as part of
a regular cash dividend program.
42
(2) During the year ended December 31, 2014, we received a $90.1 million property tax refund related to a property
tax settlement at Marina Bay Sands for the years 2010 through 2014.
(3) The second Sheraton tower of Sands Cotai Central opened in January 2013.
(4) During the year ended December 31, 2013, we paid a quarterly dividend of $0.35 per common share as part of
a regular cash dividend program.
(5) During the year ended December 31, 2013, we recorded a legal settlement expense of $47.4 million.
(6) The Conrad and Holiday Inn tower and the first Sheraton tower of Sands Cotai Central opened in April and
September 2012, respectively.
(7) During the year ended December 31, 2012, we recorded an impairment loss of $143.7 million, consisting
primarily of a $100.7 million write-off of capitalized construction costs related to our former Cotai Strip
development (referred to as parcels 7 and 8) in Macao and a $42.9 million impairment due to the termination
of the ZAiA show at The Venetian Macao.
(8) During the year ended December 31, 2012, we paid a quarterly dividend of $0.25 per common share as part of
a regular cash dividend program. Additionally, on December 18, 2012, we paid a special cash dividend of $2.75
per common share.
(9) During the year ended December 31, 2011, we repurchased, redeemed or induced holders to redeem all
outstanding preferred stock, which resulted in a charge to retained earnings of $145.7 million and is also included
in the calculation of net income attributable to common stockholders.
(10) Marina Bay Sands partially opened on April 27, 2010.
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 audited
consolidated financial statements, and the notes thereto and other financial information included in this 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.”
Operations
We view each of our casino properties as an operating segment. Our Macao operating segments consist of The
Venetian Macao, Sands Cotai Central, Four Seasons Macao, Sands Macao and other ancillary operations that support
these properties. Our Singapore operating segment consists of the Marina Bay Sands. Our operating segments in the
U.S. consist of The Venetian Las Vegas, The Palazzo and Sands Bethlehem. The Venetian Las Vegas and The Palazzo
operating segments are managed as a single integrated resort and have been aggregated into our Las Vegas Operating
Properties, considering their similar economic characteristics, types of customers, types of services and products, the
regulatory business environment of the operations within each segment and the Company’s organizational and
management reporting structure. For the years ended December 31, 2014 and 2013, gross revenue at our reportable
segments was derived as follows:
• At The Venetian Macao, approximately 84.2% and 85.3%, respectively, was from gaming activities, with the
remainder from room, mall, food and beverage and other non-gaming sources.
• At Sands Cotai Central, approximately 83.9% and 85.7%, respectively, was from gaming activities, with the
remainder primarily from room and food and beverage operations.
• At Four Seasons Macao, approximately 81.5% and 82.8%, respectively, was from gaming activities, with the
remainder primarily from mall and room operations.
• At Sands Macao, approximately 94.0% and 94.2%, respectively, was from gaming activities, with the remainder
primarily from food and beverage operations.
• At Marina Bay Sands, approximately 75.2% and 74.6%, respectively, was from gaming activities, with the
remainder from room, food and beverage, mall and other non-gaming sources.
• At our Las Vegas Operating Properties, approximately 67.6% and 63.8%, respectively, was from room, food
and beverage and other non-gaming sources, with the remainder from gaming activities. The percentage of
43
non-gaming revenue reflects the integrated resort’s emphasis on the group convention and trade show business
and the resulting high occupancy and room rates throughout the week, including during mid-week periods.
• At Sands Bethlehem, approximately 88.2% and 88.5%, respectively, was from gaming activities, with the
remainder primarily from food and beverage and other non-gaming sources.
Summary Financial Results
The following table summarizes our results of operations:
Year Ended December 31,
2014
Percent
Change
2013
Percent
Change
2012
Net revenues ........................................................ $ 14,583,849
10,484,623
Operating expenses..............................................
4,099,226
Operating income ................................................
3,832,711
Income before income taxes................................
Net income...........................................................
3,588,071
Net income attributable to Las Vegas Sands
Corp. ..................................................................
2,840,629
(Dollars in thousands)
5.9% $ 13,769,885
1.2% 10,361,642
3,408,243
20.3%
3,143,512
21.9%
2,954,676
21.4%
23.7% $ 11,131,132
8,819,750
17.5%
2,311,382
47.5%
2,062,576
52.4%
1,881,813
57.0%
23.2%
2,305,997
51.3%
1,524,093
Percent of Net Revenues
Year Ended December 31,
2014
2013
2012
Operating expenses........................................................................
Operating income ..........................................................................
Income before income taxes..........................................................
Net income.....................................................................................
Net income attributable to Las Vegas Sands Corp........................
71.9%
28.1%
26.3%
24.6%
19.5%
75.2%
24.8%
22.8%
21.5%
16.7%
79.2%
20.8%
18.5%
16.9%
13.7%
Our historical financial results will not be indicative of our future results as we continue to develop and open
new properties, including The Parisian Macao and the remaining phase of Sands Cotai Central.
Key Operating Revenue Measurements
Operating revenues at The Venetian Macao, Sands Cotai Central, Four Seasons Macao, Marina Bay Sands and
our Las Vegas Operating Properties are dependent upon the volume of customers who stay at the hotel, which affects
the price that can be charged for hotel rooms and our gaming volume. Operating revenues at Sands Macao and Sands
Bethlehem are principally driven by casino customers who visit the properties on a daily basis.
The following are the key measurements we use to evaluate operating revenues:
Casino revenue measurements for Macao and Singapore: Macao and Singapore table games are segregated into
two groups, consistent with the Macao and Singapore markets’ convention: Rolling Chip play (all VIP players) and
Non-Rolling Chip play (mostly non-VIP players). The volume measurement for Rolling Chip play is non-negotiable
gaming chips wagered and lost. The volume measurement for Non-Rolling Chip play is table games drop (“drop”),
which is the sum of markers issued (credit instruments) less markers paid at the table, plus cash deposited in the table
drop box. Rolling Chip and Non-Rolling Chip volume measurements are not comparable as the amounts wagered and
lost are substantially higher than the amounts dropped. Slot handle (“handle”), also a volume measurement, is the gross
amount wagered for the period cited.
We view Rolling Chip win as a percentage of Rolling Chip volume, Non-Rolling Chip win as a percentage of
drop and slot hold as a percentage of slot handle. Win or hold percentage represents the percentage of Rolling Chip
volume, Non-Rolling Chip drop or slot handle that is won by the casino and recorded as casino revenue. Based upon
our mix of table games, our Rolling Chip win percentage (calculated before discounts and commissions) is expected
44
to be 2.7% to 3.0%. Generally, slot machine play is conducted on a cash basis. In Macao and Singapore, 23.0% and
31.0%, respectively, of our table games play was conducted on a credit basis for the year ended December 31, 2014.
Casino revenue measurements for the U.S.: The volume measurements in the U.S. are table games drop and slot
handle, as previously described. We view table games win as a percentage of drop and slot hold as a percentage of
handle. Based upon our mix of table games, our table games are expected to produce a win percentage (calculated
before discounts) of 22% to 30% for Baccarat and 14% to 18% for non-Baccarat. As in Macao and Singapore, slot
machine play is generally conducted on a cash basis. Approximately 72.3% of our table games play at our Las Vegas
Operating Properties, for the year ended December 31, 2014, was conducted on a credit basis, while our table games
play in Pennsylvania is primarily conducted on a cash basis.
Hotel revenue measurements: Performance indicators used are occupancy rate, which is the average percentage
of available hotel rooms occupied during a period, and average daily room rate, which is the average price of occupied
rooms per day. The calculations of the hotel occupancy and average daily room rates include the impact of rooms
provided on a complimentary basis. Complimentary room rates are determined based on an analysis of retail (or cash)
room rates by customer segment and type of room product to ensure the complimentary room rates are consistent with
retail rates. Revenue per available room represents a summary of hotel average daily room rates and occupancy. Because
not all available rooms are occupied, average daily room rates are normally higher than revenue per available room.
Reserved rooms where the guests do not show up for their stay and lose their deposit may be re-sold to walk-in guests.
These rooms are considered to be occupied twice for statistical purposes due to obtaining the original deposit and the
walk-in guest revenue. In cases where a significant number of rooms are resold, occupancy rates may be in excess of
100% and revenue per available room may be higher than the average daily room rate.
Mall revenue measurements: Occupancy, base rent per square foot and tenant sales per square foot are used as
performance indicators. Occupancy represents gross leasable occupied area (“GLOA”) divided by gross leasable area
(“GLA”) at the end of the reporting period. GLOA is the sum of: (1) tenant occupied space under lease and (2) tenants
no longer occupying space, but paying rent. GLA does not include space that is currently under development or not on
the market for lease. Base rent per square foot is the weighted average base, or minimum, rent charge in effect at the
end of the reporting period for all tenants that would qualify to be included in occupancy. Tenant sales per square foot
is the sum of reported comparable sales for the trailing 12 months divided by the comparable square footage for the
same period. Only tenants that have been open for a minimum of 12 months are included in the tenant sales per square
foot calculation.
Year Ended December 31, 2014 Compared to the Year Ended December 31, 2013
Operating Revenues
Our net revenues consisted of the following:
Year Ended December 31,
2014
2013
Casino.................................................................................................... $ 12,004,361
1,540,420
Rooms ...................................................................................................
778,769
Food and beverage ................................................................................
553,534
Mall .......................................................................................................
548,704
Convention, retail and other..................................................................
15,425,788
Less — promotional allowances ...........................................................
(841,939)
Total net revenues ................................................................................. $ 14,583,849
(Dollars in thousands)
$ 11,386,917
1,380,681
730,259
481,400
515,179
14,494,436
(724,551)
$ 13,769,885
Percent
Change
5.4 %
11.6 %
6.6 %
15.0 %
6.5 %
6.4 %
(16.2)%
5.9 %
Consolidated net revenues were $14.58 billion for the year ended December 31, 2014, an increase of
$814.0 million compared to $13.77 billion for the year ended December 31, 2013. The increase in net revenues was
driven by increases of $605.0 million at our Macao operating properties and $245.8 million at Marina Bay Sands,
primarily due to increased casino revenues.
45
Casino revenues increased $617.4 million compared to the year ended December 31, 2013, despite the challenges
in the VIP market. The increase is primarily due to an increase of $474.9 million at our Macao operating properties,
which were driven by increases in Non-Rolling Chip drop, partially offset by decreases in Rolling Chip volume due
to decreased demand in the VIP market. The following table summarizes the results of our casino activity:
Year Ended December 31,
2014
2013
Change
(Dollars in thousands)
25.2%
3.22%
4.8%
21.8%
3.08%
3.5%
24.0%
3.36%
5.1%
5,564,597
7,630,366
948,110
1,335,935
3,554,352
8,960,823
2,801,441
7,432,536
Macao Operations:
The Venetian Macao
Total casino revenues ............................................................................... $
Non-Rolling Chip drop ............................................................................. $
Non-Rolling Chip win percentage ............................................................
Rolling Chip volume ................................................................................ $ 47,871,382
Rolling Chip win percentage ....................................................................
Slot handle ................................................................................................ $
Slot hold percentage .................................................................................
Sands Cotai Central
Total casino revenues ............................................................................... $
Non-Rolling Chip drop ............................................................................. $
Non-Rolling Chip win percentage ............................................................
Rolling Chip volume ................................................................................ $ 46,860,574
Rolling Chip win percentage ....................................................................
Slot handle ................................................................................................ $
Slot hold percentage .................................................................................
Four Seasons Macao
Total casino revenues ............................................................................... $
Non-Rolling Chip drop ............................................................................. $
Non-Rolling Chip win percentage ............................................................
Rolling Chip volume ................................................................................ $ 27,072,914
Rolling Chip win percentage ....................................................................
Slot handle ................................................................................................ $
Slot hold percentage .................................................................................
Sands Macao
Total casino revenues ............................................................................... $
Non-Rolling Chip drop ............................................................................. $
Non-Rolling Chip win percentage ............................................................
Rolling Chip volume ................................................................................ $ 17,663,497
Rolling Chip win percentage ....................................................................
Slot handle ................................................................................................ $
Slot hold percentage .................................................................................
Singapore Operations:
Marina Bay Sands
Total casino revenues ............................................................................... $
Non-Rolling Chip drop ............................................................................. $
Non-Rolling Chip win percentage ............................................................
Rolling Chip volume ................................................................................ $ 42,558,012
Rolling Chip win percentage ....................................................................
Slot handle ................................................................................................ $ 12,368,193
Slot hold percentage .................................................................................
U.S. Operations:
Las Vegas Operating Properties
Total casino revenues ............................................................................... $
Table games drop ...................................................................................... $
Table games win percentage .....................................................................
Slot handle ................................................................................................ $
Slot hold percentage .................................................................................
Sands Bethlehem
Total casino revenues ............................................................................... $
Table games drop ...................................................................................... $
Table games win percentage .....................................................................
Slot handle ................................................................................................ $
Slot hold percentage .................................................................................
1,148,477
3,937,850
2,574,782
4,498,674
467,994
1,062,648
509,205
2,139,545
4,016,223
3,236,093
2,114,522
830,186
19.9%
8.2%
16.8%
7.0%
18.1%
2.98%
3.7%
25.1%
3.30%
4.9%
$
$
3,415,327
7,201,033
26.8%
$ 54,420,394
$
$
$
3.32%
4,781,911
5.5%
2,432,952
5,373,622
22.5%
$ 61,073,743
$
$
$
2.66%
5,686,446
3.9%
922,743
899,627
27.5%
$ 39,280,485
$
$
$
2.46%
900,836
5.5%
1,206,462
3,488,891
19.8%
$ 23,242,588
2.77%
$
2,699,247
3.9%
$
$
2,363,140
4,650,105
23.7%
$ 60,095,322
2.46%
$ 11,118,021
5.1%
$
$
$
$
$
$
584,372
2,251,734
23.3%
2,024,147
8.7%
461,921
1,024,021
16.1%
4,129,171
7.0%
4.1%
24.4%
(1.6) pts
(12.0)%
(0.10) pts
16.4%
(0.7) pts
15.1%
38.3%
(0.7) pts
(23.3)%
0.42 pts
34.2%
(0.4) pts
2.7%
48.5%
(3.5) pts
(31.1)%
0.90 pts
(7.8)%
(0.4) pts
(4.8)%
12.9%
(1.7) pts
(24.0)%
0.21 pts
19.9%
(0.2) pts
9.0%
(3.3)%
1.4 pts
(29.2)%
0.84 pts
11.2%
(0.2) pts
(12.9)%
(5.0)%
(3.4) pts
4.5%
(0.5) pts
1.3%
3.8%
0.7 pts
(2.7)%
— pts
46
In our experience, average win percentages remain steady when measured over extended periods of time, but
can vary considerably within shorter time periods as a result of the statistical variances that are associated with games
of chance in which large amounts are wagered.
Room revenues increased $159.7 million compared to the year ended December 31, 2013. The increase is
primarily due to an $84.1 million increase at Sands Cotai Central, driven by increases in occupancy and average daily
room rates. There were also increases of $28.0 million, $23.7 million and $19.0 million at The Venetian Macao, Marina
Bay Sands and our Las Vegas Operating Properties, respectively, which were driven by an increase in average daily
room rates. The suites at Sands Macao are primarily provided to casino patrons on a complimentary basis. The following
table summarizes the results of our room activity:
Macao Operations:
The Venetian Macao
Total room revenues ............................................................................ $
Occupancy rate ....................................................................................
Average daily room rate ...................................................................... $
Revenue per available room ................................................................ $
Sands Cotai Central
Total room revenues ............................................................................ $
Occupancy rate ....................................................................................
Average daily room rate ...................................................................... $
Revenue per available room ................................................................ $
Four Seasons Macao
Total room revenues ............................................................................ $
Occupancy rate ....................................................................................
Average daily room rate ...................................................................... $
Revenue per available room ................................................................ $
Sands Macao
Total room revenues ............................................................................ $
Occupancy rate ....................................................................................
Average daily room rate ...................................................................... $
Revenue per available room ................................................................ $
Singapore Operations:
Marina Bay Sands
Total room revenues ............................................................................ $
Occupancy rate ....................................................................................
Average daily room rate ...................................................................... $
Revenue per available room ................................................................ $
U.S. Operations:
Las Vegas Operating Properties
Total room revenues ............................................................................ $
Occupancy rate ....................................................................................
Average daily room rate ...................................................................... $
Revenue per available room ................................................................ $
Sands Bethlehem
Total room revenues ............................................................................ $
Occupancy rate ....................................................................................
Average daily room rate ...................................................................... $
Revenue per available room ................................................................ $
47
Year Ended December 31,
2014
2013
Change
(Room revenues in thousands)
258,863
91.3%
270
246
320,875
88.5%
176
156
47,755
87.0%
400
348
24,066
98.6%
238
235
383,954
99.0%
431
427
491,493
88.0%
222
196
13,414
83.4%
146
122
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
230,822
91.3%
243
222
236,819
78.5%
155
121
43,626
85.3%
373
318
25,150
96.1%
252
242
360,264
98.6%
396
390
472,518
89.6%
205
184
11,482
73.6%
142
104
12.1%
— pts
11.1%
10.8%
35.5%
10.0 pts
13.5%
28.9%
9.5%
1.7 pts
7.2%
9.4%
(4.3)%
2.5 pts
(5.6)%
(2.9)%
6.6%
0.4 pts
8.8%
9.5%
4.0%
(1.6) pts
8.3%
6.5%
16.8%
9.8 pts
2.8%
17.3%
Food and beverage revenues increased $48.5 million compared to the year ended December 31, 2013. The increase
was primarily due to a $41.4 million increase at our Macao operating properties, driven by an increase in property
visitation.
Mall revenues increased $72.1 million compared to the year ended December 31, 2013. The increase was primarily
due to a $56.0 million increase at our Macao operating properties, driven by an increase in base rents. For further
information related to the financial performance of our malls, see"— Additional Information Regarding our Retail Mall
Operations." The following table summarizes the results of our mall activity:
Year Ended December 31,
2014
2013
Change
(Mall revenues in thousands)
$
$
$
$
$
$
42,116
210,143
56,408
330,258
169,151
755,452
191,631
771,345
95.5%
179
1,522
97.9%
136
1,450
93.4%
212
1,673
100.0%
120
1,277
33.9%
57.2%
(2.1) pts
13.3%
13.5%
13.3%
2.1%
(2.1) pts
18.4%
9.9%
Macao Operations:
Shoppes at Venetian
Total mall revenues.............................................................................. $
Mall gross leasable area (in square feet) .............................................
Occupancy ...........................................................................................
Base rent per square foot ..................................................................... $
Tenant sales per square foot................................................................. $
Shoppes at Cotai Central(1)
Total mall revenues.............................................................................. $
Mall gross leasable area (in square feet) .............................................
Occupancy ...........................................................................................
Base rent per square foot ..................................................................... $
Tenant sales per square foot................................................................. $
Shoppes at Four Seasons
Total mall revenues.............................................................................. $
Mall gross leasable area (in square feet) .............................................
Occupancy ...........................................................................................
Base rent per square foot ..................................................................... $
Tenant sales per square foot................................................................. $
Singapore Operations:
The Shoppes at Marina Bay Sands
Total mall revenues.............................................................................. $
Mall gross leasable area (in square feet) .............................................
Occupancy ...........................................................................................
Base rent per square foot ..................................................................... $
Tenant sales per square foot................................................................. $
U.S. Operations:
The Outlets at Sands Bethlehem
Total mall revenues.............................................................................. $
Mall gross leasable area (in square feet) .............................................
Occupancy ...........................................................................................
Base rent per square foot ..................................................................... $
Tenant sales per square foot................................................................. $
_________________________
(1) The first, second and third phases of the Shoppes at Cotai Central opened in April and September 2012 and June
2014, respectively. At completion, the Shoppes at Cotai Central will feature up to 600,000 square feet of gross
leasable area.
23.3%
12.0%
3.4 pts
(13.0)%
(15.3)%
10.0%
1.0%
5.4 pts
1.4%
(6.7)%
17.0%
6.6%
11.5 pts
20.1%
20.4%
96.1%
220
1,426
99.2%
418
5,689
90.7%
217
1,528
87.7%
348
4,726
97.0%
20
365
93.6%
23
431
132,326
257,963
169,257
648,778
113,121
241,895
153,840
642,241
3,912
151,029
3,172
134,830
$
$
$
$
$
$
$
$
$
48
Operating Expenses
The breakdown of operating expenses is as follows:
Year Ended December 31,
2014
2013
6,705,534
Casino.................................................................................................... $
256,835
Rooms ...................................................................................................
392,560
Food and beverage ................................................................................
69,732
Mall .......................................................................................................
320,759
Convention, retail and other..................................................................
186,722
Provision for doubtful accounts ............................................................
1,258,133
General and administrative ...................................................................
174,750
Corporate...............................................................................................
26,230
Pre-opening ...........................................................................................
14,325
Development .........................................................................................
1,031,589
Depreciation and amortization ..............................................................
40,598
Amortization of leasehold interests in land...........................................
Loss on disposal of assets .....................................................................
6,856
Total operating expenses....................................................................... $ 10,484,623
$
(Dollars in thousands)
6,483,718
271,942
369,570
73,358
317,869
237,786
1,329,740
189,535
13,339
15,809
1,007,468
40,352
11,156
$ 10,361,642
Percent
Change
3.4 %
(5.6)%
6.2 %
(4.9)%
0.9 %
(21.5)%
(5.4)%
(7.8)%
96.6 %
(9.4)%
2.4 %
0.6 %
(38.5)%
1.2 %
Operating expenses were $10.48 billion for the year ended December 31, 2014, an increase of $123.0 million
compared to $10.36 billion for the year ended December 31, 2013. The increase in operating expenses was primarily
attributable to an increase in casino expenses at our Macao operating properties.
Casino expenses increased $221.8 million compared to the year ended December 31, 2013. The increase was
primarily due to a $229.6 million increase at our Macao operating properties, of which $104.3 million was due to the
39% gross win tax on increased casino revenues and the remaining $125.3 million was driven by an increase in payroll-
related expenses.
The provision for doubtful accounts was $186.7 million for the year ended December 31, 2014, compared to
$237.8 million for the year ended December 31, 2013. The decrease was driven by the overall decrease in casino
receivables at our Macao operating properties due to the decrease in VIP play. The amount of this provision can vary
over short periods of time because of factors specific to the customers who owe us money from gaming activities at
any given time. We believe that the amount of our provision for doubtful accounts in the future will depend upon the
state of the economy, our credit standards, our risk assessments and the judgment of our employees responsible for
granting credit.
General and administrative expenses decreased $71.6 million compared to the year ended December 31, 2013.
The decrease was primarily attributable to a $78.5 million decrease at Marina Bay Sands, driven by a $90.1 million
property tax refund received in December 2014 related to the settlement of taxes assessed and paid for the years 2010
through 2014. There was also a $36.5 million decrease at our Las Vegas Operating Properties, driven by a $47.4 million
legal settlement charge incurred in August 2013 (see “Item 8 — Financial Statements and Supplementary Data — Notes
to Consolidated Financial Statements — Note 13 — Commitments and Contingencies — Litigation”). These decreases
were partially offset by a $37.0 million increase at our Macao operating properties.
Corporate expenses decreased $14.8 million compared to the year ended December 31, 2013, which was driven
by a decrease in legal fees.
Pre-opening expenses were $26.2 million for the year ended December 31, 2014, compared to $13.3 million for
the year ended December 31, 2013. Pre-opening expense represents personnel and other costs incurred prior to the
opening of new ventures, which are expensed as incurred. Pre-opening expenses for the years ended December 31,
2014 and 2013, were primarily related to activities at The Parisian Macao and Sands Cotai Central, respectively.
Development expenses include the costs associated with the Company’s evaluation and pursuit of new business
opportunities, which are also expensed as incurred.
49
Adjusted Property EBITDA
Adjusted property EBITDA is used by management as the primary measure of the operating performance of our
segments. Adjusted property EBITDA is net income before intersegment royalty fees, stock-based compensation
expense, legal settlement expense, corporate expense, pre-opening expense, development expense, depreciation and
amortization, amortization of leasehold interests in land, impairment loss, loss on disposal of assets, interest, other
income (expense), loss on modification or early retirement of debt and income taxes. The following table summarizes
information related to our segments (see “Item 8 — Financial Statements and Supplementary Data — Notes to
Consolidated Financial Statements — Note 17 — Segment Information” for discussion of our operating segments and
a reconciliation of adjusted property EBITDA to net income):
Macao:
The Venetian Macao ...................................................................... $
Sands Cotai Central........................................................................
Four Seasons Macao ......................................................................
Sands Macao ..................................................................................
Other Asia ......................................................................................
Marina Bay Sands .................................................................................
United States:
Las Vegas Operating Properties.....................................................
Sands Bethlehem............................................................................
Total adjusted property EBITDA.......................................................... $
______________
N.M. - Not meaningful
Year Ended December 31,
2014
2013
(Dollars in thousands)
Percent
Change
1,546,323
1,001,487
374,899
338,590
3,493
3,264,792
1,723,147
313,913
120,491
434,404
5,422,343
$
$
1,499,937
739,723
305,040
362,858
(3,855)
2,903,703
1,384,576
351,739
123,337
475,076
4,763,355
3.1 %
35.4 %
22.9 %
(6.7)%
N.M.
12.4 %
24.5 %
(10.8)%
(2.3)%
(8.6)%
13.8 %
Adjusted property EBITDA at our Macao operations increased $361.1 million compared to the year ended
December 31, 2013. As previously described, the increase was primarily due to a $605.0 million increase in net revenues
at our Macao operating properties, partially offset by a $229.6 million increase in casino expenses. Additionally, there
was a $55.0 million increase in expenses due to a new bonus program for non-management employees in Macao initiated
during the year ended December 31, 2014.
Adjusted property EBITDA at Marina Bay Sands increased $338.6 million compared to the year ended
December 31, 2013. The increase was primarily due to a $245.8 million increase in net revenues driven by an increase
in casino revenues, and as previously described, a $90.1 million property tax refund received in December 2014.
Adjusted property EBITDA at our Las Vegas Operating Properties decreased $37.8 million compared to the year
ended December 31, 2013. The decrease was primarily due to a $44.8 million decrease in net revenues (excluding
intersegment royalty revenue) driven by a decrease in casino revenues.
Adjusted property EBITDA at Sands Bethlehem decreased $2.8 million compared to the year ended December 31,
2013. Net revenues increased $7.5 million, but were offset by increases of $6.2 million and $5.8 million in general and
administrative expenses and casino expenses, respectively.
50
Interest Expense
The following table summarizes information related to interest expense:
Year Ended December 31,
2013
2014
(Dollars in thousands)
Interest cost (which includes the amortization of deferred financing costs and
original issue discounts).......................................................................................... $
Add — imputed interest on deferred proceeds from sale of The Shoppes at The
15,190
Palazzo ....................................................................................................................
(9,308)
Less — capitalized interest .......................................................................................
274,181
Interest expense, net .................................................................................................. $
Cash paid for interest ................................................................................................ $
215,929
Weighted average total debt balance......................................................................... $ 9,991,874
Weighted average interest rate ..................................................................................
268,299
2.7%
$
260,704
15,168
(4,661)
271,211
$
$
212,903
$ 9,788,457
2.7%
Interest cost increased $7.6 million compared to the year ended December 31, 2013, due to an increase in our
weighted average debt balance. Capitalized interest increased $4.6 million compared to the year ended December 31,
2013, primarily due to the construction of The Parisian Macao.
Other Factors Effecting Earnings
Other income was $2.0 million for the year ended December 31, 2014, compared to $4.3 million for the year
ended December 31, 2013. The amounts in both periods were primarily due to foreign exchange gains.
The loss on modification or early retirement of debt was $19.9 million for the year ended December 31, 2014,
and was primarily due to an $18.0 million loss related to the amendment of our 2011 VML Credit Facility in March
2014 (see “Item 8 — Financial Statements and Supplementary Data — Notes to Consolidated Financial Statements —
Note 8 — Long-term Debt — 2011 VML Credit Facility”).
Our effective income tax rate was 6.4% for the year ended December 31, 2014, compared to 6.0% for the year
ended December 31, 2013. The effective income tax rates reflect a 17% statutory tax rate on our Singapore operations
and a zero percent tax rate on profits generated by our Macao gaming operations due to our income tax exemption in
Macao, which was extended in October 2013 through the end of 2018. We have recorded a valuation allowance related
to certain deferred tax assets generated by operations in the U.S. and certain foreign jurisdictions; however, to the extent
that the financial results of these operations improve and it becomes “more-likely-than-not” that these deferred tax
assets or a portion thereof are realizable, we will reduce the valuation allowances in the period such determination is
made.
The net income attributable to our noncontrolling interests was $747.4 million for the year ended December 31,
2014, compared to $648.7 million for the year ended December 31, 2013. These amounts are primarily related to the
noncontrolling interest of SCL.
51
Year Ended December 31, 2013 Compared to the Year Ended December 31, 2012
Operating Revenues
Our net revenues consisted of the following:
Year Ended December 31,
2013
2012
Casino.................................................................................................... $ 11,386,917
1,380,681
Rooms ...................................................................................................
730,259
Food and beverage ................................................................................
481,400
Mall .......................................................................................................
515,179
Convention, retail and other..................................................................
14,494,436
Less — promotional allowances ...........................................................
(724,551)
Total net revenues ................................................................................. $ 13,769,885
$
(Dollars in thousands)
9,008,158
1,154,024
628,528
396,927
497,032
11,684,669
(553,537)
$ 11,131,132
Percent
Change
26.4 %
19.6 %
16.2 %
21.3 %
3.7 %
24.0 %
(30.9)%
23.7 %
Consolidated net revenues were $13.77 billion for the year ended December 31, 2013, an increase of $2.64 billion
compared to $11.13 billion for the year ended December 31, 2012. The increase in net revenues was driven by an
increase of $1.65 billion at Sands Cotai Central due to its progressive opening that commenced in April 2012, and an
increase of $813.3 million at The Venetian Macao, primarily due to increased casino revenues.
52
Casino revenues increased $2.38 billion compared to the year ended December 31, 2012. The increase is primarily
attributable to an increase of $1.47 billion at Sands Cotai Central, due to its progressive opening, and a $786.5 million
increase at The Venetian Macao, driven by an increase in Non-Rolling Chip drop. The following table summarizes the
results of our casino activity:
Year Ended December 31,
2013
2012
Change
(Dollars in thousands)
26.8%
3.32%
5.5%
922,743
899,627
Macao Operations:
The Venetian Macao
Total casino revenues........................................................................... $ 3,415,327
Non-Rolling Chip drop........................................................................ $ 7,201,033
Non-Rolling Chip win percentage.......................................................
Rolling Chip volume ........................................................................... $ 54,420,394
Rolling Chip win percentage ...............................................................
Slot handle ........................................................................................... $ 4,781,911
Slot hold percentage ............................................................................
Sands Cotai Central
Total casino revenues........................................................................... $ 2,432,952
Non-Rolling Chip drop........................................................................ $ 5,373,622
Non-Rolling Chip win percentage.......................................................
Rolling Chip volume ........................................................................... $ 61,073,743
Rolling Chip win percentage ...............................................................
Slot handle ........................................................................................... $ 5,686,446
Slot hold percentage ............................................................................
Four Seasons Macao
Total casino revenues........................................................................... $
Non-Rolling Chip drop........................................................................ $
Non-Rolling Chip win percentage.......................................................
Rolling Chip volume ........................................................................... $ 39,280,485
Rolling Chip win percentage ...............................................................
Slot handle ........................................................................................... $
Slot hold percentage ............................................................................
Sands Macao
Total casino revenues........................................................................... $ 1,206,462
Non-Rolling Chip drop........................................................................ $ 3,488,891
Non-Rolling Chip win percentage.......................................................
Rolling Chip volume ........................................................................... $ 23,242,588
Rolling Chip win percentage ...............................................................
Slot handle ........................................................................................... $ 2,699,247
Slot hold percentage ............................................................................
Singapore Operations:
Marina Bay Sands
Total casino revenues........................................................................... $ 2,363,140
Non-Rolling Chip drop........................................................................ $ 4,650,105
Non-Rolling Chip win percentage.......................................................
Rolling Chip volume ........................................................................... $ 60,095,322
Rolling Chip win percentage ...............................................................
Slot handle ........................................................................................... $ 11,118,021
Slot hold percentage ............................................................................
U.S. Operations:
Las Vegas Operating Properties
Total casino revenues........................................................................... $
584,372
Table games drop................................................................................. $ 2,251,734
Table games win percentage................................................................
Slot handle ........................................................................................... $ 2,024,147
Slot hold percentage ............................................................................
Sands Bethlehem
Total casino revenues........................................................................... $
461,921
Table games drop................................................................................. $ 1,024,021
Table games win percentage................................................................
Slot handle ........................................................................................... $ 4,129,171
Slot hold percentage ............................................................................
900,836
22.5%
2.66%
3.9%
27.5%
2.46%
5.5%
19.8%
2.77%
3.9%
23.3%
8.7%
16.1%
7.0%
23.7%
2.46%
5.1%
$ 2,628,868
$ 4,482,318
0.3%
$ 48,825,435
3.05%
$ 4,946,114
5.3%
29.9%
60.7%
26.5 pts
11.5%
0.27 pts
(3.3)%
0.2 pts
$
960,286
$ 1,863,923
20.8%
$ 26,046,168
153.4%
188.3%
1.7 pts
134.5%
2.83% (0.17) pts
$ 2,939,426
3.5%
93.5%
0.4 pts
$
$
977,616
433,264
(5.6)%
107.6%
40.8% (13.3) pts
$ 41,604,458
(5.6)%
2.79% (0.33) pts
$
962,540
5.3%
$ 1,219,400
$ 2,872,468
21.0%
$ 25,184,583
(6.4)%
0.2 pts
(1.1)%
21.5%
(1.2) pts
(7.7)%
3.14% (0.37) pts
$ 2,476,673
4.3%
9.0%
(0.4) pts
$ 2,271,869
$ 4,612,227
23.1%
$ 52,568,238
4.0%
0.8%
0.6 pts
14.3%
2.47% (0.01) pts
$ 10,793,348
5.3%
3.0%
(0.2) pts
$
512,647
$ 2,084,490
21.1%
$ 1,944,618
8.7%
$
$
437,472
885,359
15.3%
$ 4,029,326
7.2%
14.0%
8.0%
2.2 pts
4.1%
— pts
5.6%
15.7%
0.8 pts
2.5%
(0.2) pts
53
In our experience, average win percentages remain steady when measured over extended periods of time, but
can vary considerably within shorter time periods as a result of the statistical variances that are associated with games
of chance in which large amounts are wagered.
Room revenues increased $226.7 million compared to the year ended December 31, 2012. The increase is
attributable to an increase of $153.0 million at Sands Cotai Central, due to its progressive opening, an increase of
$34.8 million at Marina Bay Sands, driven by an increase in average daily room rates, and an increase of $26.3 million
at our Las Vegas Operating Properties, driven by an increase in occupancy. The suites at Sands Macao are primarily
provided to casino patrons on a complimentary basis. The following table summarizes the results of our room activity:
Macao Operations:
The Venetian Macao
Total room revenues ............................................................................ $
Occupancy rate ....................................................................................
Average daily room rate ...................................................................... $
Revenue per available room ................................................................ $
Sands Cotai Central
Total room revenues ............................................................................ $
Occupancy rate ....................................................................................
Average daily room rate ...................................................................... $
Revenue per available room ................................................................ $
Four Seasons Macao
Total room revenues ............................................................................ $
Occupancy rate ....................................................................................
Average daily room rate ...................................................................... $
Revenue per available room ................................................................ $
Sands Macao
Total room revenues ............................................................................ $
Occupancy rate ....................................................................................
Average daily room rate ...................................................................... $
Revenue per available room ................................................................ $
Singapore Operations:
Marina Bay Sands
Total room revenues ............................................................................ $
Occupancy rate ....................................................................................
Average daily room rate ...................................................................... $
Revenue per available room ................................................................ $
U.S. Operations:
Las Vegas Operating Properties
Total room revenues ............................................................................ $
Occupancy rate ....................................................................................
Average daily room rate ...................................................................... $
Revenue per available room ................................................................ $
Sands Bethlehem
Total room revenues ............................................................................ $
Occupancy rate ....................................................................................
Average daily room rate ...................................................................... $
Revenue per available room ................................................................ $
Year Ended December 31,
2013
2012
Change
(Room revenues in thousands)
230,822
91.3%
243
222
236,819
78.5%
155
121
43,626
85.3%
373
318
25,150
96.1%
252
242
360,264
98.6%
396
390
472,518
89.6%
205
184
11,482
73.6%
142
104
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
224,177
91.9%
237
218
3.0%
(0.6) pts
2.5%
1.8%
83,833
182.5%
83.4%
155
129
(4.9) pts
—%
(6.2)%
39,813
80.1%
362
290
24,441
95.3%
245
234
9.6%
5.2 pts
3.0%
9.7%
2.9%
0.8 pts
2.9%
3.4%
325,470
98.9%
355
351
10.7%
(0.3) pts
11.5%
11.1%
446,241
86.1%
203
175
10,049
65.1%
140
91
5.9%
3.5 pts
1.0%
5.1%
14.3%
8.5 pts
1.4%
14.3%
Food and beverage revenues increased $101.7 million compared to the year ended December 31, 2012. The
increase was primarily attributable to a $62.3 million increase at Sands Cotai Central, due to its progressive opening,
as well as a $26.3 million increase at our Las Vegas Operating Properties, driven by an increase in banquet operations.
54
Mall revenues increased $84.5 million compared to the year ended December 31, 2012. The increase was primarily
due to an $85.3 million increase at our Macao operating properties, driven by an increase in base rents as well as the
progressive opening of Sands Cotai Central. For further information related to the financial performance of our malls,
see"— Additional Information Regarding our Retail Mall Operations." The following table summarizes the results of
our mall activity:
Year Ended December 31,
2013
2012
Change
(Mall revenues in thousands)
$
$
$
$
$
$
16,074
210,143
42,116
210,143
139,522
805,976
169,151
755,452
92.3%
147
1,214
95.5%
179
1,522
100.0%
120
1,277
100.0%
112
—
21.2%
(6.3)%
3.2 pts
21.8%
25.4%
162.0%
—%
— pts
7.1%
—%
Macao Operations:
Shoppes at Venetian
Total mall revenues.............................................................................. $
Mall gross leasable area (in square feet) .............................................
Occupancy ...........................................................................................
Base rent per square foot ..................................................................... $
Tenant sales per square foot................................................................. $
Shoppes at Cotai Central(1)
Total mall revenues.............................................................................. $
Mall gross leasable area (in square feet) .............................................
Occupancy ...........................................................................................
Base rent per square foot ..................................................................... $
Tenant sales per square foot................................................................. $
Shoppes at Four Seasons(2)
Total mall revenues.............................................................................. $
Mall gross leasable area (in square feet) .............................................
Occupancy ...........................................................................................
Base rent per square foot ..................................................................... $
Tenant sales per square foot................................................................. $
Singapore Operations:
The Shoppes at Marina Bay Sands(3)
Total mall revenues.............................................................................. $
Mall gross leasable area (in square feet) .............................................
Occupancy ...........................................................................................
Base rent per square foot ..................................................................... $
Tenant sales per square foot................................................................. $
U.S. Operations:
The Outlets at Sands Bethlehem(4)
Total mall revenues.............................................................................. $
Mall gross leasable area (in square feet) .............................................
Occupancy ...........................................................................................
Base rent per square foot ..................................................................... $
Tenant sales per square foot................................................................. $
_________________________
(1) The first, second and third phases of the Shoppes at Cotai Central opened in April and September 2012 and June
2014, respectively. At completion, the Shoppes at Cotai Central will feature up to 600,000 square feet of gross
leasable area.
106.6%
4.3%
22.3 pts
—%
—%
(1.6)%
0.7%
(5.3) pts
0.9%
9.7%
35.5%
0.9%
(4.4) pts
87.7%
348
4,726
90.7%
217
1,528
96.0%
215
1,393
92.1%
150
4,356
71.3%
—
—
93.6%
23
431
153,840
642,241
113,121
241,895
156,319
637,980
3,172
134,830
83,477
239,718
1,535
129,216
132.0%
8.5%
$
$
$
$
$
$
$
$
$
(2) Beginning in August 2013, a significant portion of the rent paid by the duty-free luxury shops was converted from
overage rent to base rent in accordance with the respective lease agreements, resulting in an increase in base rent
per square foot.
(3) The decrease in occupancy at The Shoppes at Marina Bay Sands was due to an ongoing repositioning of the mall
that brought in new tenants and expanded key luxury tenants. Approximately 37,000 square feet of gross leasable
area was undergoing new fit-out or development and was not considered occupied as of December 31, 2013.
55
(4) A progressive opening of The Outlets at Sands Bethlehem began in November 2011. Base rent per square foot
and tenant sales per square foot for the year ended December 31, 2012, are excluded from the table as certain co-
tenancy requirements were not met during 2012 as the mall was only partially occupied.
Operating Expenses
The breakdown of operating expenses is as follows:
Year Ended December 31,
2013
2012
6,483,718
Casino.................................................................................................... $
271,942
Rooms ...................................................................................................
369,570
Food and beverage ................................................................................
73,358
Mall .......................................................................................................
317,869
Convention, retail and other..................................................................
237,786
Provision for doubtful accounts ............................................................
1,329,740
General and administrative ...................................................................
189,535
Corporate...............................................................................................
13,339
Pre-opening ...........................................................................................
15,809
Development .........................................................................................
1,007,468
Depreciation and amortization ..............................................................
40,352
Amortization of leasehold interests in land...........................................
—
Impairment loss.....................................................................................
Loss on disposal of assets .....................................................................
11,156
Total operating expenses....................................................................... $ 10,361,642
$
(Dollars in thousands)
5,128,036
237,303
331,210
68,763
304,263
239,332
1,061,935
207,030
143,795
19,958
892,046
40,165
143,674
2,240
8,819,750
$
Percent
Change
26.4 %
14.6 %
11.6 %
6.7 %
4.5 %
(0.6)%
25.2 %
(8.5)%
(90.7)%
(20.8)%
12.9 %
0.5 %
(100.0)%
398.0 %
17.5 %
Operating expenses were $10.36 billion for the year ended December 31, 2013, an increase of $1.54 billion
compared to $8.82 billion for the year ended December 31, 2012. The increase in operating expenses was primarily
attributable to the progressive opening of Sands Cotai Central that commenced in April 2012.
Casino expenses increased $1.36 billion compared to the year ended December 31, 2012. Of the increase, $986.8
million was attributable to the 39% gross win tax on increased casino revenue across all of our Macao properties, as
well as $211.5 million of additional casino expenses attributable to Sands Cotai Central.
Rooms and food and beverage expenses increased $34.6 million and $38.4 million, respectively, compared to
the year ended December 31, 2012. These increases were driven by the associated increases in the related revenues
described above.
The provision for doubtful accounts was $237.8 million for the year ended December 31, 2013, compared to
$239.3 million for the year ended December 31, 2012. The amount of this provision can vary over short periods of time
because of factors specific to the customers who owe us money from gaming activities at any given time. We believe
that the amount of our provision for doubtful accounts in the future will depend upon the state of the economy, our
credit standards, our risk assessments and the judgment of our employees responsible for granting credit.
General and administrative expenses increased $267.8 million compared to the year ended December 31, 2012.
The increase was primarily attributable to a $122.2 million increase at Sands Cotai Central, a $72.7 million increase
at our Las Vegas Operating Properties, driven by a $47.4 million legal settlement expense (see “Item 8 — Financial
Statements and Supplementary Data — Notes to Consolidated Financial Statements — Note 13 — Commitments and
Contingencies — Litigation”), as well as a $63.9 million increase at The Venetian Macao, driven by an increase in
advertising expense.
Corporate expenses decreased $17.5 million compared to the year ended December 31, 2012, which was driven
by a decrease in legal fees.
56
Pre-opening expenses were $13.3 million for the year ended December 31, 2013, compared to $143.8 million
for the year ended December 31, 2012. Pre-opening expense represents personnel and other costs incurred prior to the
opening of new ventures, which are expensed as incurred. Pre-opening expenses for the years ended December 31,
2013 and 2012, were primarily related to activities at Sands Cotai Central. Development expenses include the costs
associated with the Company’s evaluation and pursuit of new business opportunities, which are also expensed as
incurred.
Depreciation and amortization expense increased $115.4 million compared to the year ended December 31, 2012.
The increase was primarily attributable to a $146.6 million increase at Sands Cotai Central, partially offset by decreases
at our Las Vegas Operating Properties and other Macao operating properties due to certain assets being fully depreciated.
The impairment loss of $143.7 million for the year ended December 31, 2012, consisted primarily of a $100.7
million write-off of capitalized construction costs related to our former Cotai Strip development (referred to as parcels
7 and 8) in Macao and a $42.9 million impairment due to the termination of the ZAiA show at The Venetian Macao.
Adjusted Property EBITDA
The following table summarizes information related to our segments:
Macao:
The Venetian Macao ...................................................................... $
Sands Cotai Central........................................................................
Four Seasons Macao ......................................................................
Sands Macao ..................................................................................
Other Asia ......................................................................................
Marina Bay Sands .................................................................................
United States:
Las Vegas Operating Properties.....................................................
Sands Bethlehem............................................................................
Total adjusted property EBITDA.......................................................... $
Year Ended December 31,
2013
2012
(Dollars in thousands)
Percent
Change
1,499,937
739,723
305,040
362,858
(3,855)
2,903,703
1,384,576
351,739
123,337
475,076
4,763,355
$
$
1,143,245
213,476
288,170
350,639
(15,950)
1,979,580
1,366,245
331,182
114,055
445,237
3,791,062
31.2%
246.5%
5.9%
3.5%
75.8%
46.7%
1.3%
6.2%
8.1%
6.7%
25.6%
Adjusted property EBITDA at our Macao operations increased $924.1 million compared to the year ended
December 31, 2012. The increase was primarily attributable to an increase of $526.2 million at Sands Cotai Central,
due to its progressive opening that commenced in April 2012, as well as an increase of $356.7 million at The Venetian
Macao, driven by an increase in casino activity.
Adjusted property EBITDA at Marina Bay Sands increased $18.3 million compared to the year ended
December 31, 2012. The increase was primarily attributable to an $82.2 million increase in net revenues driven by an
increase in casino revenues, partially offset by increases in the associated operating expenses.
Adjusted property EBITDA at our Las Vegas Operating Properties increased $20.6 million compared to the year
ended December 31, 2012. Net revenues increased $123.2 million (excluding intersegment royalty revenue), but was
offset by increases in the associated operating expenses.
Adjusted property EBITDA at Sands Bethlehem increased $9.3 million compared to the year ended December 31,
2012. The increase was primarily attributable to a $26.3 million increase in net revenues, driven by an increase in casino
activity, partially offset by increases in the associated operating expenses.
57
Interest Expense
The following table summarizes information related to interest expense:
Year Ended December 31,
2012
2013
(Dollars in thousands)
Interest cost (which includes the amortization of deferred financing costs and
original issue discounts).......................................................................................... $
Add — imputed interest on deferred proceeds from sale of The Shoppes at The
15,168
Palazzo ....................................................................................................................
(4,661)
Less — capitalized interest .......................................................................................
271,211
Interest expense, net .................................................................................................. $
Cash paid for interest ................................................................................................ $
212,903
Weighted average total debt balance......................................................................... $ 9,788,457
Weighted average interest rate ..................................................................................
260,704
2.7%
$
292,790
15,123
(49,349)
258,564
$
$
258,440
$ 9,772,201
3.0%
Interest cost decreased $32.1 million compared to the year ended December 31, 2012, resulting primarily from
a decrease in our weighted average interest rate. Capitalized interest decreased $44.7 million compared to the year
ended December 31, 2012, primarily due to the completion of the Conrad and Holiday Inn tower and the first and
second Sheraton towers of Sands Cotai Central in April and September 2012 and January 2013, respectively.
Other Factors Effecting Earnings
Other income was $4.3 million for the year ended December 31, 2013, compared to $5.7 million for the year
ended December 31, 2012. The income during the year ended December 31, 2013, was primarily attributable to foreign
exchange gains.
The loss on modification or early retirement of debt of $14.2 million for the year ended December 31, 2013,
related to the refinancing of our U.S. credit facility in December 2013 (see “Item 8 — Financial Statements and
Supplementary Data — Notes to Consolidated Financial Statements — Note 8 — Long-Term Debt — Senior Secured
Credit Facility”).
Our effective income tax rate was 6.0% for the year ended December 31, 2013, compared to 8.8% for the year
ended December 31, 2012. The effective income tax rates reflect a 17% statutory tax rate on our Singapore operations
and a zero percent tax rate on profits generated by our Macao gaming operations due to our income tax exemption in
Macao, which was extended in October 2013 through the end of 2018. We have recorded a valuation allowance related
to certain deferred tax assets generated by operations in the U.S. and certain foreign jurisdictions; however, to the extent
that the financial results of these operations improve and it becomes “more-likely-than-not” that these deferred tax
assets or a portion thereof are realizable, we will reduce the valuation allowances in the period such determination is
made.
The net income attributable to our noncontrolling interests was $648.7 million for the year ended December 31,
2013, compared to $357.7 million for the year ended December 31, 2012. These amounts are primarily related to the
noncontrolling interest of SCL.
58
Additional Information Regarding our Retail Mall Operations
The following tables summarize the results of our mall operations for the years ended December 31, 2014, 2013
and 2012 (in thousands):
Shoppes at
Venetian
Shoppes at
Four Seasons
Shoppes
at Cotai
Central(1)
The Shoppes
at Marina Bay
Sands
The Outlets
at Sands
Bethlehem(2)
Total
Common area maintenance ............
17,471
For the year ended December 31,
2014
Mall revenues:
Minimum rents(3) ............................ $
Overage rents..................................
CAM, levies and management fees
Total mall revenues.............................
Mall operating expenses:
Management fees and other direct
operating expenses .......................
Mall operating expenses.....................
Property taxes(4) .............................
Provision for doubtful accounts .....
Mall-related expenses(5)......................
For the year ended December 31,
2013
Mall revenues:
Minimum rents(3) ............................ $
Overage rents..................................
CAM, levies and management fees
Total mall revenues.............................
Mall operating expenses:
Common area maintenance ............
Management fees and other direct
operating expenses .......................
Mall operating expenses.....................
Property taxes.................................
Provision for (recovery of)
doubtful accounts .........................
Mall-related expenses(5)......................
For the year ended December 31,
2012
Mall revenues:
Minimum rents(3) ............................ $
Overage rents..................................
CAM, levies and management fees
Total mall revenues.............................
Mall operating expenses:
Common area maintenance ............
Management fees and other direct
operating expenses .......................
Mall operating expenses.....................
Property taxes.................................
Provision for doubtful accounts .....
Mall-related expenses(5)......................
130,555
$
87,666
$
31,943
$
122,494
$
33,860
27,216
191,631
36,809
7,851
132,326
6,417
23,888
(1,486)
216
22,618
5,802
1,562
7,364
—
223
7,587
13,589
10,876
56,408
6,451
1,884
8,335
—
2
8,337
16,725
30,038
169,257
24,983
3,356
28,339
(1,961)
990
27,368
104,080
$
47,913
$
23,030
$
106,318
$
39,615
25,456
169,151
16,894
6,975
23,869
1,486
(281)
25,074
58,246
6,962
113,121
5,466
1,607
7,073
—
226
7,299
11,584
7,502
42,116
5,577
1,275
6,852
—
(245)
6,607
16,584
30,938
153,840
25,370
8,083
33,453
7,123
(5)
40,571
81,906
$
23,068
$
10,770
$
109,468
$
36,434
21,182
139,522
15,573
7,344
22,917
—
410
23,327
54,909
5,500
83,477
4,051
1,895
5,946
—
330
6,276
1,566
3,738
16,074
2,485
1,226
3,711
—
607
4,318
14,941
31,910
156,319
25,928
8,828
34,756
8,548
123
43,427
$
$
$
1,486
2,426
—
3,912
1,238
568
1,806
1,201
25
3,032
1,268
1,904
—
3,172
1,320
791
2,111
1,093
—
3,204
800
735
—
1,535
1,077
356
1,433
759
—
2,192
374,144
103,409
75,981
553,534
55,945
13,787
69,732
(2,246)
1,456
68,942
282,609
127,933
70,858
481,400
54,627
18,731
73,358
9,702
(305)
82,755
226,012
108,585
62,330
396,927
49,114
19,649
68,763
9,307
1,470
79,540
____________________
(1) The first, second and third phases of the Shoppes at Cotai Central opened in April and September 2012, and June
2014, respectively. At completion, the Shoppes at Cotai Central will feature up to 600,000 square feet of gross
leasable area.
59
(2) Revenues from CAM, levies and management fees are included in minimum rents for The Outlets at Sands
Bethlehem.
(3) Minimum rents include base rents and straight-line adjustments of base rents.
(4) Commercial property that generates rental income is exempt from property tax for the first six years for newly
constructed buildings in Cotai. This property tax exemption expired in August 2013 for The Venetian Macao. In
May 2014, the Company received an additional six-year property tax exemption for The Venetian Macao. As a
result, during the year ended December 31, 2014, the Company reversed $1.5 million of previously recognized
property taxes for The Venetian Macao. Additionally, as previously described, Marina Bay Sands received a $90.1
million property tax refund in December 2014, of which $9.0 million related to the mall.
(5) Mall-related expenses consist of CAM, management fees and other direct operating expenses, property taxes and
provision for (recovery of) doubtful accounts, but excludes depreciation and amortization and general and
administrative costs.
It is common in the mall operating industry for companies to disclose mall net operating income (“NOI”) as a
useful supplemental measure of a mall’s operating performance. Because NOI excludes general and administrative
expenses, interest expense, impairment losses, depreciation and amortization, gains and losses from property
dispositions, allocations to noncontrolling interests and provision for income taxes, it provides a performance measure
that, when compared year over year, reflects the revenues and expenses directly associated with owning and operating
commercial real estate properties and the impact on operations from trends in occupancy rates, rental rates and operating
costs.
In the tables above, we believe that taking total mall revenues less mall-related expenses provides an operating
performance measure for our malls. Other mall operating companies may use different methodologies for deriving
mall-related expenses. As such, this calculation may not be comparable to the NOI of other mall operating companies.
Development Projects
Macao
We submitted plans to the Macao government for The Parisian Macao, an integrated resort that will be connected
to The Venetian Macao and Four Seasons Macao. The Parisian Macao is intended to include a gaming area (to be
operated under our gaming subconcession), a hotel with over 3,000 rooms and suites and retail, entertainment, dining
and meeting facilities. We expect the cost to design, develop and construct The Parisian Macao to be approximately
$2.7 billion, inclusive of payments made for the land premium. We recommenced construction upon receiving certain
government approvals, after a temporary stoppage from June through August 2014. As with projects of this nature, we
will continue to analyze options for both a full and phased opening of the facility, which is anticipated to open in 2016,
subject to Macao government approval. We have capitalized costs of $804.3 million, including the land premium (net
of amortization), as of December 31, 2014. In addition, we will be completing the development of some public areas
surrounding our Cotai Strip properties on behalf of the Macao government.
As of December 31, 2014, we have capitalized an aggregate of $9.84 billion in construction costs and land
premiums (net of amortization) for our Cotai Strip developments, which include The Venetian Macao, Sands Cotai
Central, Four Seasons Macao and The Parisian Macao, as well as our investments in transportation infrastructure,
including our passenger ferry service operations.
Land concessions in Macao generally have an initial term of 25 years with automatic extensions of 10 years
thereafter in accordance with Macao law. We have received land concessions from the Macao government to build on
the sites on which The Venetian Macao, Sands Cotai Central, Four Seasons Macao and The Parisian Macao are located.
We do not own these land sites in Macao; however, the land concessions grant us exclusive use of the land. As specified
in the land concessions, we are required to pay premiums for each parcel, which are either payable in a single lump
sum upon acceptance of the land concessions by the Macao government or in seven semi-annual installments, as well
as annual rent for the term of the land concessions.
Under our land concession for The Parisian Macao, we are required to complete the development by April 2016.
The land concession for Sands Cotai Central contains a similar requirement that the development be completed by
December 2016. Should we determine that we are unable to complete The Parisian Macao or Sands Cotai Central by
60
their respective deadlines, we would expect to apply for another extension from the Macao government. If we are
unable to meet the current deadlines and the deadlines for either development are not extended, we could lose our land
concessions for The Parisian Macao or Sands Cotai Central, which would prohibit us from operating any facilities
developed under the respective land concessions. As a result, we could record a charge for all or some portion of the
$804.3 million or $4.47 billion in capitalized construction costs and land premiums (net of amortization), as of
December 31, 2014, related to The Parisian Macao and Sands Cotai Central, respectively.
United States
We were constructing the Las Vegas Condo Tower, located on the Las Vegas Strip between The Palazzo and The
Venetian Las Vegas. We suspended our construction activities for the project due to reduced demand for Las Vegas
Strip condominiums and the overall decline in general economic conditions. We intend to recommence construction
when demand and conditions improve. The impact of the suspension on the estimated overall cost of the project is
currently not determinable with certainty. Should demand and conditions fail to improve or management decide to
abandon the project, we could record a charge for some portion of the $178.6 million in capitalized construction costs
as of December 31, 2014.
Other
We continue to aggressively pursue new development opportunities globally.
Liquidity and Capital Resources
Cash Flows — Summary
Our cash flows consisted of the following:
2014
Net cash generated from operating activities ................................ $
Cash flows from investing activities:
Change in restricted cash and cash equivalents .....................
Capital expenditures ...............................................................
Proceeds from disposal of property and equipment ...............
Acquisition of intangible assets..............................................
Net cash used in investing activities..............................................
Cash flows from financing activities:
Proceeds from exercise of stock options ................................
Excess tax benefits from stock-based compensation .............
Repurchase of common stock ................................................
Proceeds from exercise of warrants .......................................
Dividends paid........................................................................
Distributions to noncontrolling interests ................................
Deemed distribution to Principal Stockholder .......................
Proceeds from long-term debt ................................................
Repayments of long-term debt ...............................................
Payments of deferred financing costs.....................................
Net cash used in financing activities .............................................
Effect of exchange rate on cash.....................................................
Increase (decrease) in cash and cash equivalents .......................... $
61
Year Ended December 31,
2013
(In thousands)
4,439,412
$
$
4,832,844
270
(1,178,656)
1,818
—
(1,176,568)
55,650
3,585
(1,676,802)
—
(2,386,657)
(9,773)
—
2,497,725
(2,117,466)
(88,048)
(3,721,786)
(28,585)
(94,095) $
(382)
(898,111)
32,155
(45,871)
(912,209)
69,596
—
(561,150)
350
(1,564,049)
(11,858)
—
3,183,107
(3,513,032)
(35,414)
(2,432,450)
(7,105)
1,087,648
$
2012
3,057,757
693
(1,449,234)
2,909
—
(1,445,632)
46,240
—
—
528,908
(3,442,312)
(10,466)
(18,576)
4,351,486
(4,399,698)
(100,888)
(3,045,306)
43,229
(1,389,952)
Cash Flows — Operating Activities
Table games play at our properties is conducted on a cash and credit basis. Slot machine play is primarily conducted
on a cash basis. The retail hotel rooms business is generally conducted on a cash basis, the group hotel rooms business
is conducted on a cash and credit basis, and banquet business is conducted primarily on a credit basis resulting in
operating cash flows being generally affected by changes in operating income and accounts receivable. Net cash
generated from operating activities increased $393.4 million compared to the year ended December 31, 2013. The
increase was primarily attributable to the increase in operating cash flows generated from our Macao operating properties
and Marina Bay Sands.
Cash Flows — Investing Activities
Capital expenditures for the year ended December 31, 2014, totaled $1.18 billion, including $946.1 million for
construction and development activities in Macao, which consisted primarily of $390.6 million for The Parisian Macao
and $345.7 million for Sands Cotai Central; $108.7 million at our Las Vegas Operating Properties; $79.6 million in
Singapore; and $44.3 million for corporate and other activities.
Cash Flows — Financing Activities
Net cash flows used in financing activities were $3.72 billion for the year ended December 31, 2014, which was
primarily attributable to $2.39 billion in dividend payments and $1.68 billion in common stock repurchases, partially
offset by net proceeds of $430.0 million from our 2013 U.S. Revolving Facility.
As of December 31, 2014, we had $1.78 billion available for borrowing under our U.S., Macao and Singapore
credit facilities, net of letters of credit.
Capital Financing Overview
Through December 31, 2014, we have funded our development projects primarily through borrowings from our
credit facilities (see “Item 8 — Financial Statements and Supplementary Data — Notes to Consolidated Financial
Statements — Note 8 — Long-term Debt”), operating cash flows, proceeds from our equity offerings and proceeds
from the disposition of non-core assets.
Our U.S., Macao and Singapore credit facilities contain various financial covenants. The U.S. credit facility,
which was amended in December 2013, requires our Las Vegas operations to comply with a financial covenant at the
end of each quarter to the extent that any revolving loans or certain letters of credit are outstanding. This financial
covenant requires our Las Vegas operations to maintain a maximum leverage ratio of net debt, as defined, to trailing
twelve-month adjusted earnings before interest, income taxes, depreciation and amortization, as defined (“Adjusted
EBITDA”). The maximum leverage ratio is 5.5x for all quarterly periods through maturity. We can elect to contribute
cash on hand to our Las Vegas operations on a bi-quarterly basis; such contributions having the effect of increasing
Adjusted EBITDA during the applicable quarter for purposes of calculating compliance with the maximum leverage
ratio. Our Macao credit facility, which was amended in March 2014 (see “Item 8 — Financial Statements and
Supplementary Data — Notes to Consolidated Financial Statements — Note 8 — Long-term Debt — 2011 VML Credit
Facility”), also requires our Macao operations to comply with similar financial covenants, including maintaining a
maximum leverage ratio of debt to Adjusted EBITDA. The maximum leverage ratio is 4.5x for the quarterly periods
ending December 31, 2014 through September 30, 2015, decreases to 4.0x for the quarterly periods ending December 31,
2015 through March 31, 2017, and then decreases to, and remains at, 3.5x for all quarterly periods thereafter through
maturity. Our Singapore credit facility, which was amended in August 2014 (see “Item 8 — Financial Statements and
Supplementary Data — Notes to Consolidated Financial Statements — Note 8 — Long-term Debt — 2012 Singapore
Credit Facility”), requires operations of Marina Bay Sands to comply with similar financial covenants, including
maintaining a maximum leverage ratio of debt to Adjusted EBITDA. The maximum leverage ratio is 3.5x for the
quarterly periods ending December 31, 2014 through September 30, 2019, and then decreases to, and remains at, 3.0x
for all quarterly periods thereafter through maturity. As of December 31, 2014, our U.S., Macao and Singapore leverage
ratios were 1.0x, 1.0x and 2.2x, respectively, compared to the maximum leverage ratios allowed of 5.5x, 4.5x and 3.5x,
respectively. If we are unable to maintain compliance with the financial covenants under these credit facilities, we
would be in default under the respective credit facilities. A default under the U.S. credit facility would trigger a cross-
62
default under our airplane financings. Any defaults or cross-defaults under these agreements would allow the lenders,
in each case, to exercise their rights and remedies as defined under their respective agreements. If the lenders were to
exercise their rights to accelerate the due dates of the indebtedness outstanding, there can be no assurance that we would
be able to repay or refinance any amounts that may become due and payable under such agreements, which could force
us to restructure or alter our operations or debt obligations.
We held unrestricted cash and cash equivalents of approximately $3.51 billion and restricted cash and cash
equivalents of approximately $6.6 million as of December 31, 2014, of which approximately $2.98 billion of the
unrestricted amount is held by non-U.S. subsidiaries. Of the $2.98 billion, approximately $2.21 billion is available to
be repatriated to the U.S. with minimal taxes owed on such amounts due to the significant foreign taxes we paid, which
would ultimately generate U.S. foreign tax credits if cash is repatriated. The remaining unrestricted amounts are not
available for repatriation primarily due to dividend requirements to third party public shareholders in the case of funds
being repatriated from SCL. We believe the cash on hand and cash flow generated from operations will be sufficient
to maintain compliance with the financial covenants of our credit facilities. We may elect to arrange additional financing
to fund the balance of our Cotai Strip developments. In the normal course of our activities, we will continue to evaluate
our capital structure and opportunities for enhancements thereof.
In March 2014, we amended our 2011 VML Credit Facility, which extended the maturity to March 31, 2020, and
provided for revolving loan commitments of $2.0 billion, which is being used to fund the development, construction
and completion of Sands Cotai Central and The Parisian Macao, and for working capital requirements and general
corporate purposes. In August 2014, we amended our SGD 5.1 billion (approximately $3.86 billion at exchange rates
in effect on December 31, 2014) 2012 Singapore Credit Facility, which extended the maturity of the 2012 Singapore
Revolving Facility and the 2012 Singapore Term Facility to February 28 and August 28, 2020, respectively. The proceeds
of the 2012 Singapore Credit Facility were used to repay the outstanding indebtedness under the prior Singapore credit
facility. During the year ended December 31, 2014, we had net borrowings of $430.0 million under the revolving portion
of our $3.5 billion 2013 U.S. Credit Facility, which facility was completed in December 2013 and its proceeds were
primarily used to repay the outstanding indebtedness under the prior senior secured credit facility. In March 2012, we
redeemed the outstanding balance of Senior Notes for $191.7 million and in May 2012, we repaid the $131.6 million
outstanding balance under our ferry financing.
On February 26, 2014, SCL paid a dividend of 0.87 Hong Kong dollars ("HKD") per share and a special dividend
of HKD 0.77 per share, and, on June 30, 2014, paid a dividend of HKD 0.86 per share to SCL shareholders (a total of
$2.60 billion, of which we retained $1.82 billion). On February 28 and June 21, 2013, SCL paid a dividend of HKD
0.67 and HKD 0.66 per share, respectively, to SCL shareholders (a total of $1.38 billion, of which we retained $970.2
million). On February 28 and June 22, 2012, SCL paid a dividend of HKD 0.58 per share to SCL shareholders (a total
of $1.20 billion, of which we retained $844.4 million). On January 23, 2015, the Board of Directors of SCL declared
a dividend of HKD 0.99 per share (a total of $1.03 billion, of which we retained $722 million) to SCL shareholders of
record on February 13, 2015, which was paid on February 27, 2014.
During the year ended December 31, 2014, we paid a quarterly dividend of $0.50 per common share and recorded
$1.61 billion as a distribution against retained earnings. During the year ended December 31, 2013, we paid a quarterly
dividend of $0.35 per common share and recorded $1.15 billion as a distribution against retained earnings. During the
year ended December 31, 2012, we paid a quarterly dividend of $0.25 per common share as part of a regular cash
dividend program and on December 18, 2012, we paid a special cash dividend of $2.75 per common share. During the
year ended December 31, 2012, we recorded $3.09 billion as a distribution against retained earnings. On January 28,
2015, our Board of Directors declared a quarterly dividend of $0.65 per common share (a total estimated to be
approximately $519 million) to be paid on March 31, 2015, to shareholders of record on March 23, 2015. We expect
this level of dividend to continue quarterly through the remainder of 2015. Our Board of Directors will continually
assess the level and appropriateness of any cash dividends.
In June 2013, our Board of Directors approved a stock repurchase program with an initial authorization of $2.0
billion, which expires in June 2015, but was completed during the year ended December 31, 2014. In October 2014,
our Board of Directors authorized the repurchase of an additional $2.0 billion of our outstanding common stock, which
expires in October 2016. Repurchases of our common stock are made at our discretion in accordance with applicable
federal securities laws in the open market or otherwise. The timing and actual number of shares to be repurchased in
63
the future will depend on a variety of factors, including our financial position, earnings, legal requirements, other
investment opportunities and market conditions. During the year ended December 31, 2014 and 2013, we repurchased
22,406,655 and 8,570,281 shares, respectively, of our common stock for $1.66 billion and $570.5 million, respectively,
(including commissions) under this program. All share repurchases of our common stock have been recorded as treasury
stock.
On March 2, 2012, our Principal Stockholder’s family exercised all of their outstanding warrants to purchase
87,500,175 shares of our common stock and paid $525.0 million in cash as settlement of the exercise price.
Aggregate Indebtedness and Other Known Contractual Obligations
Our total long-term indebtedness and other known contractual obligations are summarized below as of
December 31, 2014:
Payments Due by Period Ending December 31, 2014
(11)
Less than
1 Year
2-3 Years
4-5 Years
(In thousands)
More than
5 Years
Total
Long-Term Debt Obligations(1)
2013 U.S. Credit Facility — Term B........ $
2013 U.S. Credit Facility — Revolving...
Airplane Financings .................................
HVAC Equipment Lease(2) .......................
U.S. Other.................................................
2011 VML Credit Facility — Extended
Term........................................................
2011 VML Credit Facility — Extended
Revolving ...............................................
Macao Other .............................................
2012 Singapore Credit Facility — Term..
Fixed Interest Payments ...........................
Variable Interest Payments(3) ....................
Contractual Obligations
Former Tenants(4)......................................
Employment Agreements(5) ......................
Macao Leasehold Interests in Land(6).......
Mall Leases(7) ...........................................
Macao Annual Premium(8)........................
Parking Lot Lease(9)..................................
Other Operating Leases(10)........................
Total.......................................................... $
_______________________
$
22,500
—
3,688
1,464
261
45,000
$
45,000
— 1,020,000
—
12,417
—
59,983
2,738
140
$ 2,115,000
—
—
—
—
$ 2,227,500
1,020,000
63,671
16,619
401
—
179,119
1,397,123
812,002
2,388,244
—
2,271
69,550
1,372
226,755
400
5,500
5,096
8,582
42,682
1,200
13,860
405,181
—
3,219
139,101
2,175
442,446
—
204
1,373,622
1,297
382,402
820,024
—
1,877,864
—
95,849
820,024
5,694
3,460,137
4,844
1,147,452
800
6,500
10,552
17,244
85,364
2,400
12,092
$ 1,008,873
800
6,500
10,552
16,170
85,364
2,400
3,486
$ 4,357,337
4,400
—
70,536
78,333
106,704
101,100
—
$ 6,081,812
6,400
18,500
96,736
120,329
320,114
107,100
29,438
$ 11,853,203
(1) See “Item 8 — Financial Statements and Supplementary Data — Notes to Consolidated Financial Statements
— Note 8 — Long-Term Debt” for further details on these financing transactions.
(2) In July 2009, we entered into a capital lease agreement with our current heating, ventilation and air conditioning
(“HVAC”) provider (the “HVAC Equipment Lease”) to provide the operation and maintenance services for the
HVAC equipment in Las Vegas. The lease has a 10-year term with a purchase option at the third, fifth, seventh
and tenth anniversary dates. We are obligated under the agreement to make monthly payments of approximately
$300,000 for the first year with automatic decreases of approximately $14,000 per month on every anniversary
date. The HVAC Equipment Lease has been capitalized at the present value of the future minimum lease payments
at lease inception.
64
(3) Based on December 31, 2014, London Inter-Bank Offered Rate (“LIBOR”) of 0.3%, Hong Kong Inter-Bank
Offered Rate (“HIBOR”) of 0.4% and Singapore Swap Offer Rate (“SOR”) of 0.7% plus the applicable interest
rate spread in accordance with the respective debt agreements.
(4) We are party to tenant lease termination and asset purchase agreements. Under the agreement for The Grand
Canal Shoppes sale, we are obligated to fulfill the lease termination and asset purchase agreements.
(5) We are party to employment agreements with three of our executive officers, with remaining terms of one to
five years.
(6) We are party to long-term land leases of 25 years with automatic extensions at our option of 10 years thereafter
in accordance with Macao law.
(7) We are party to certain leaseback agreements for the theater, gondola and certain office and retail space related
to the sales of The Grand Canal Shoppes and The Shoppes at the Palazzo.
(8) In addition to the 39% gross gaming win tax in Macao (which is not included in this table as the amount we
pay is variable in nature), we are required to pay an annual premium with a fixed portion and a variable portion,
which is based on the number and type of gaming tables and gaming machines we operate. Based on the gaming
tables and gaming machines in operation as of December 31, 2014, the annual premium is approximately $42.7
million payable to the Macao government through the termination of the gaming subconcession in June 2022.
(9) We are party to a 99-year lease agreement (89 years remaining) for a parking structure located adjacent to The
Venetian Las Vegas.
(10) We are party to certain operating leases for real estate, various equipment and service arrangements.
(11) As of December 31, 2014, we had a $12.2 million liability related to unrecognized tax benefits; we do not expect
this liability to result in a payment of cash within the next 12 months. We are unable to reasonably estimate the
timing of the liability in individual years beyond 12 months due to uncertainties in the timing of the effective
settlement of tax positions; therefore, such amounts are not included in the table.
Off-Balance Sheet Arrangements
We have not entered into any transactions with special purpose entities, nor have we engaged in any derivative
transactions other than interest rate caps.
Restrictions on Distributions
We are a parent company with limited business operations. Our main asset is the stock and membership interests
of our subsidiaries. The debt instruments of our U.S., Macao and Singapore subsidiaries contain certain restrictions
that, among other things, limit the ability of 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
our assets of our company without prior approval of the lenders or noteholders.
Inflation
We believe that inflation and changing prices have not had a material impact on our sales, revenues or income
from continuing operations during the past three fiscal years.
Special Note Regarding Forward-Looking Statements
This report contains forward-looking statements that are made pursuant to the Safe Harbor Provisions of the
Private Securities Litigation Reform Act of 1995. These forward-looking statements include the discussions of our
business strategies and expectations concerning future operations, margins, profitability, liquidity and capital resources.
In addition, in certain portions included in this report, the words: “anticipates,” “believes,” “estimates,” “seeks,”
“expects,” “plans,” “intends” and similar expressions, as they relate to our company or management, are intended to
identify forward-looking statements. Although we believe that these forward-looking statements are reasonable, we
cannot assure you that any forward-looking statements will prove to be correct. These forward- looking statements
involve known and unknown risks, uncertainties and other factors, which may cause our actual results, performance
or achievements to be materially different from any future results, performance or achievements expressed or implied
by these forward-looking statements. These factors include, among others, the risks associated with:
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general economic and business conditions in the U.S. and internationally, which may impact levels of disposable
income, consumer spending, group meeting business, pricing of hotel rooms and retail and mall sales;
our leverage, debt service and debt covenant compliance, including the pledge of our assets (other than our
equity interests in our subsidiaries) as security for our indebtedness;
disruptions in the global financing markets and our ability to obtain sufficient funding for our current and future
developments;
the extensive regulations to which we are subject to and the costs of compliance with such regulations;
increased competition for labor and materials due to other planned construction projects in Macao and quota
limits on the hiring of foreign workers;
our ability to meet certain development deadlines;
the uncertainty of tourist behavior related to discretionary spending and vacationing at casino-resorts in Macao,
Singapore, Las Vegas and Pennsylvania;
regulatory policies in mainland China or other countries in which our customers reside, including visa restrictions
limiting the number of visits or the length of stay for visitors from mainland China to Macao, restrictions on
foreign currency exchange or importation of currency, and the judicial enforcement of gaming debts;
our dependence upon properties primarily in Macao, Singapore and Las Vegas for all of our cash flow;
our relationship with GGP or any successor owner of the Grand Canal Shoppes;
new developments, construction and ventures, including our Cotai Strip developments;
the passage of new legislation and receipt of governmental approvals for our proposed developments in Macao
and other jurisdictions where we are planning to operate;
our insurance coverage, including the risk that we have not obtained sufficient coverage or will only be able to
obtain additional coverage at significantly increased rates;
disruptions or reductions in travel, as well as disruptions in our operations, due to natural or man-made disasters,
outbreaks of infectious diseases, terrorist activity or war;
our ability to collect gaming receivables from our credit players;
our dependence on chance and theoretical win rates;
fraud and cheating;
our ability to establish and protect our IP rights;
conflicts of interest that arise because certain of our directors and officers are also directors of SCL;
government regulation of the casino industry (as well as new laws and regulations and changes to existing laws
and regulations), including gaming license regulation, the requirement for certain beneficial owners of our
securities to be found suitable by gaming authorities, the legalization of gaming in other jurisdictions and
regulation of gaming on the Internet;
increased competition in Macao and Las Vegas, including recent and upcoming increases in hotel rooms, meeting
and convention space, retail space, potential additional gaming licenses and online gaming;
the popularity of Macao, Singapore and Las Vegas as convention and trade show destinations;
new taxes, changes to existing tax rates or proposed changes in tax legislation;
our ability to maintain our gaming licenses, certificate and subconcession;
the continued services of our key management and personnel;
any potential conflict between the interests of our Principal Stockholder and us;
the ability of our subsidiaries to make distribution payments to us;
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our failure to maintain the integrity of our customer or company data, including against past or future
cybersecurity attacks, and any litigation or disruption to our operations resulting from such loss of data integrity;
the completion of infrastructure projects in Macao; and
the outcome of any ongoing and future litigation.
All future written and verbal forward-looking statements attributable to us or any person acting on our behalf are
expressly qualified in their entirety by the cautionary statements contained or referred to in this section. New risks and
uncertainties arise from time to time, and it is impossible for us to predict these events or how they may affect us.
Readers are cautioned not to place undue reliance on these forward-looking statements. We assume no obligation to
update any forward-looking statements after the date of this report as a result of new information, future events or
developments, except as required by federal securities laws.
Critical Accounting Policies and Estimates
The preparation of our consolidated financial statements in conformity with accounting principles generally
accepted in the United States of America requires our 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. These estimates and judgments are based on historical information, information that is currently available
to us and on various other assumptions that management believes to be reasonable under the circumstances. Actual
results could vary from those estimates and we may change our estimates and assumptions in future evaluations. Changes
in these estimates and assumptions may have a material effect on our results of operations and financial condition. We
believe that the critical accounting policies discussed below affect our more significant judgments and estimates used
in the preparation of our consolidated financial statements.
Allowance for Doubtful Casino Accounts
We maintain an allowance, or reserve, for doubtful casino accounts at our operating casino resorts in Macao,
Singapore and the U.S., which we regularly evaluate. We specifically analyze the collectability of each account with
a balance over a specified dollar amount, based upon the age of the account, the customer’s financial condition, collection
history and any other known information, and we apply standard reserve percentages to aged account balances under
the specified dollar amount. We also monitor regional and global economic conditions and forecasts in our evaluation
of the adequacy of the recorded reserves. Credit or marker play was 23.0%, 31.0% and 72.3% of table games play at
our Macao properties, Marina Bay Sands and Las Vegas Operating Properties, respectively, during the year ended
December 31, 2014. Our allowance for doubtful casino accounts was 33.8% and 29.3% of gross casino receivables as
of December 31, 2014 and 2013, respectively. The credit extended to our junkets can be offset by the commissions
payable to said junkets, which is considered in the establishment of the allowance for doubtful accounts. Our allowance
for doubtful accounts from our hotel and other receivables is not material.
Litigation Accrual
We are subject to various claims and legal actions. We estimate the accruals for these claims and legal actions
based on all relevant facts and circumstances currently available and include such accruals in other accrued liabilities
in the consolidated balance sheets when it is determined that such contingencies are both probable and reasonably
estimable.
Property and Equipment
At December 31, 2014, we had net property and equipment of $15.37 billion, representing 68.7% of our total
assets. We depreciate property and equipment on a straight-line basis over their estimated useful lives. The estimated
useful lives are based on the nature of the assets as well as current operating strategy and legal considerations such as
contractual life. Future events, such as property expansions, property developments, new competition, or new
regulations, could result in a change in the manner in which we use certain assets requiring a change in the estimated
useful lives of such assets.
67
For assets to be held and used (including projects under development), fixed assets are reviewed for impairment
whenever indicators of impairment exist. If an indicator of impairment exists, we first group our assets with other assets
and liabilities at the lowest level for which identifiable cash flows are largely independent of the cash flows of other
assets and liabilities (the “asset group”). Secondly, we estimate the undiscounted future cash flows that are directly
associated with and expected to arise from the completion, use and eventual disposition of such asset group. We estimate
the undiscounted cash flows over the remaining useful life of the primary asset within the asset group. If the undiscounted
cash flows exceed the carrying value, no impairment is indicated. If the undiscounted cash flows do not exceed the
carrying value, then an impairment is measured based on fair value compared to carrying value, with fair value typically
based on a discounted cash flow model. If an asset is still under development, future cash flows include remaining
construction costs.
To estimate the undiscounted cash flows of our asset groups, we consider all potential cash flows scenarios, which
are probability weighted based on management’s estimates given current conditions. Determining the recoverability
of our asset groups is judgmental in nature and requires the use of significant estimates and assumptions, including
estimated cash flows, probability weighting of potential scenarios, costs to complete construction for assets under
development, growth rates and future market conditions, among others. Future changes to our estimates and assumptions
based upon changes in macro-economic factors, regulatory environments, operating results or management’s intentions
may result in future changes to the recoverability of our asset groups.
For assets to be held for sale, the fixed assets (the “disposal group”) are measured at the lower of their carrying
amount or fair value less cost to sell. Losses are recognized for any initial or subsequent write-down to fair value less
cost to sell, while gains are recognized for any subsequent increase in fair value less cost to sell, but not in excess of
the cumulative loss previously recognized. Any gains or losses not previously recognized that result from the sale of
the disposal group shall be recognized at the date of sale. Fixed assets are not depreciated while classified as held for
sale.
Capitalized Interest
Interest costs associated with our major construction projects are capitalized and included in the cost of the
projects. When no debt is incurred specifically for construction projects, we capitalize interest on amounts expended
using the weighted average cost of our outstanding borrowings. Capitalization of interest ceases when the project is
substantially complete or construction activity is suspended for more than a brief period.
Leasehold Interests in Land
Leasehold interests in land represent payments made for the use of land over an extended period of time. The
leasehold interests in land are amortized on a straight-line basis over the expected term of the related lease agreements.
Indefinite Useful Life Assets
As of December 31, 2014, we had a $50.0 million asset related to our Sands Bethlehem gaming license and a
$16.5 million asset related to our Sands Bethlehem table games certificate, both of which were determined to have
indefinite useful lives. Assets with indefinite useful lives are assessed regularly to ensure they continue to meet the
indefinite useful life criteria. These assets are not subject to amortization and are tested for impairment and recoverability
annually or more frequently if events or circumstances indicate that the assets might be impaired. When performing
our impairment analysis, we may first conduct a qualitative assessment to determine whether we believe it is “more-
likely-than-not” that the asset is impaired. If we elect to perform a qualitative assessment and we determine it is “more-
likely-than-not” that the asset is impaired after assessing the qualitative factors, we then perform an impairment test
that consists of a comparison of the fair value of the asset with its carrying amount. If the carrying amount of the asset
is not recoverable and exceeds its fair value, an impairment will be recognized in an amount equal to that excess. If
the carrying amount of the asset does not exceed the fair value, no impairment is recognized.
If a quantitative impairment test is to be performed to estimate the fair value of our intangible assets, our fair
value analysis would be based on expected adjusted property EBITDA, combined with estimated future tax-affected
cash flows and a terminal value using the Gordon Growth Model, which are discounted to present value at rates
commensurate with our capital structure and the prevailing borrowing rates within the casino industry in general.
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Adjusted property EBITDA and discounted cash flows are common measures used to value cash-intensive businesses
such as casinos. Determining the fair value of the gaming license and table games certificate is judgmental in nature
and requires the use of significant estimates and assumptions, including adjusted property EBITDA, growth rates,
discount rates and future market conditions, among others. If we determine a qualitative assessment is to be performed,
we assess certain qualitative factors including, but not limited to, the results of the most recent fair value calculation,
operating results and projected operating results, and macro-economic and industry conditions.
Future changes to our estimates and assumptions based upon changes in operating results, macro-economic factors
or management’s intentions may result in future changes to the fair value of the gaming license and table games
certificate.
Stock-Based Compensation
Accounting standards regarding share-based payments require the recognition of compensation expense in the
consolidated statements of operations related to the fair value of employee stock-based compensation. Determining
the fair value of stock-based awards at the grant date requires judgment, including estimating the expected term that
stock options will be outstanding prior to exercise, the associated volatility and the expected dividends. Expected
volatilities are based on our historical volatility or combined with the historical volatilities from a selection of companies
from our peer group when there is a lack of our historical information, as is the case for our SCL equity plan. The
expected option life is based on the contractual term of the option as well historical exercise and forfeiture behavior.
When there is a lack of historical information, as is the case for our SCL equity plan, we use the simplified method for
estimating expected option life, as the options qualify as “plain-vanilla” options. The expected dividend yield is based
on our estimate of annual dividends expected to be paid at the time of the grant. We believe that the valuation technique
and the approach utilized to develop the underlying assumptions are appropriate in calculating the fair values of our
stock options granted. Judgment is also required in estimating the amount of stock-based awards expected to be forfeited
prior to vesting. If actual forfeitures differ significantly from these estimates, stock-based compensation expense could
be materially impacted. All employee stock options were granted with an exercise price equal to the fair market value
(as defined in the Company’s equity award plans).
During the years ended December 31, 2014 and 2013, we recorded stock-based compensation expense of $48.1
million and $53.4 million, respectively. As of December 31, 2014, under the 2004 plan there was $41.5 million of
unrecognized compensation cost, net of estimated forfeitures of 8.0% per year, related to unvested stock options and
there was $15.8 million of unrecognized compensation cost, net of estimated forfeitures of 8.0% per year, related to
unvested restricted stock and stock units. The stock option and restricted stock and stock unit costs are expected to be
recognized over a weighted average period of 4.6 years and 1.6 years, respectively.
As of December 31, 2014, under the SCL Equity Plan there was $32.6 million of unrecognized compensation
cost, net of estimated forfeitures of 8.8% per year, related to unvested stock options and there was $13.5 million of
unrecognized compensation cost related to unvested restricted stock units. The stock option and restricted stock unit
costs are expected to be recognized over a weighted average period of 2.7 years and 2.5 years, respectively.
Income Taxes
We are subject to income taxes in the U.S. (including federal and state) and numerous foreign jurisdictions in
which we operate. We record income taxes under the asset and liability method, whereby deferred tax assets and
liabilities are recognized based on the future tax consequences attributable to temporary differences between the financial
statement carrying amounts of existing assets and liabilities and their respective tax bases, and attributable to operating
loss and tax credit carryforwards. Accounting standards regarding income taxes require a reduction of the carrying
amounts of deferred tax assets by a valuation allowance, if based on the available evidence, it is “more-likely-than-
not” that such assets will not be realized. Accordingly, the need to establish valuation allowances for deferred tax assets
is assessed at each reporting period based on a “more-likely-than-not” realization threshold. This assessment considers,
among other matters, the nature, frequency and severity of current and cumulative losses, forecasts of future profitability,
the duration of statutory carryforward periods, our experience with operating loss and tax credit carryforwards not
expiring, and implementation of tax planning strategies.
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We recorded a valuation allowance on the net deferred tax assets of certain foreign jurisdictions of $215.2 million
and $217.8 million, as of December 31, 2014 and 2013, respectively, and a valuation allowance on certain net deferred
tax assets of our U.S. operations of $2.27 billion and $1.30 billion as of December 31, 2014 and 2013, respectively.
Management will reassess the realization of deferred tax assets based on the applicable accounting standards for income
taxes each reporting period and consider the scheduled reversal of deferred tax liabilities, sources of taxable income
and tax planning strategies. To the extent that the financial results of these operations improve and it becomes “more-
likely-than-not” that the deferred tax assets are realizable, we will be able to reduce the valuation allowance in the
period such determination is made.
Significant judgment is required in evaluating our tax positions and determining our provision for income taxes.
During the ordinary course of business, there are many transactions for which the tax treatment is uncertain. Accounting
standards regarding uncertainty in income taxes provides a two-step approach to recognizing and measuring uncertain
tax positions. The first step is to evaluate the tax position for recognition by determining if the weight of available
evidence indicates it is “more-likely-than-not” that the position will be sustained on audit, including resolution of related
appeals or litigation processes, if any. The second step is to measure the tax benefit as the largest amount which is more
than 50% likely, based solely on the technical merits, of being sustained on examinations. We consider many factors
when evaluating and estimating our tax positions and tax benefits, which may require periodic adjustments and for
which actual outcomes may be different.
Our major tax jurisdictions are the U.S., Macao, and Singapore. We are subject to examination for years beginning
2010 in the U.S., Macao and Singapore. The Inland Revenue Authority of Singapore is currently performing a compliance
review of the Marina Bay Sands tax return for tax years 2010 through 2012.
Recent Accounting Pronouncements
See related disclosure at “Item 8 — Financial Statements and Supplementary Data — Notes to Consolidated
Financial Statements — Note 2 — Summary of Significant Accounting Policies.”
ITEM 7A. — QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
Market risk is the risk of loss arising from adverse changes in market rates and prices, such as interest rates,
foreign currency exchange rates and commodity prices. Our primary exposure to market risk is interest rate risk
associated with our variable rate long-term debt, which we may manage through the use of interest rate cap agreements.
We do not hold or issue financial instruments for trading purposes and do not enter into derivative transactions that
would be considered speculative positions. Our derivative financial instruments consist exclusively of interest rate cap
agreements, which do not qualify for hedge accounting. 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 agreements, we enter 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 our credit facilities, which management believes further
minimizes the risk of nonperformance.
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The table below provides information about our 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. Notional amounts are used to calculate the contractual payments to be exchanged under the contract.
Weighted average variable rates are based on December 31, 2014, LIBOR, HIBOR and SOR plus the applicable interest
rate spread in accordance with the respective debt agreements. The information is presented in U.S. dollar equivalents,
which is the Company’s reporting currency, for the years ending December 31:
2015
2016
2017
2018
2019
Thereafter
Total
Fair
Value
(1)
(In millions)
95.7
$
95.7
$
327.5
$ 1,686.5
$ 2,149.3
$ 5,624.9
$ 9,979.6
$ 9,778.8
2.6%
2.6%
1.9%
1.8%
2.0%
2.5%
2.3%
— $
— $
— $
— $
— $
— $
— $
—
LIABILITIES
Long-term debt
Variable rate................................... $
Average interest rate(2) ...................
ASSETS
Cap Agreements(3) ......................... $
_________________________
(1) The estimated fair values are based on level 2 inputs (quoted prices in markets that are not active).
(2) Based upon contractual interest rates for fixed rate indebtedness or current LIBOR, HIBOR and SOR for variable
rate indebtedness. Based on variable rate debt levels as of December 31, 2014, an assumed 100 basis point
change in LIBOR, HIBOR and SOR would cause our annual interest cost to change by approximately
$89.2 million.
(3) As of December 31, 2014, we have 4 interest rate cap agreements with a nominal aggregate fair value based
on quoted market values from the institutions holding the agreements.
Borrowings under the 2013 U.S. Credit Facility, as amended, bear interest, at our option, at either an adjusted
Eurodollar rate or at an alternative base rate, plus a credit spread. For base rate borrowings, the initial credit spread is
0.5% per annum and 1.5% per annum for the 2013 U.S. Revolving Facility and the 2013 U.S. Term B Facility,
respectively. For Eurodollar rate borrowings, the initial credit spread is 1.5% per annum and 2.5% per annum for the
2013 U.S. Revolving Facility and the 2013 U.S. Term B Facility (subject to a Eurodollar rate floor of 0.75%), respectively.
Borrowings under the 2011 VML Credit Facility bear interest, at our option, at either an adjusted Eurodollar rate or
HIBOR, plus a credit spread, or an alternative base rate, plus a credit spread, which credit spread in each case is
determined based on the maximum leverage ratio set forth in the credit facility agreement, as amended. The credit
spread for the Extended 2011 VML Term and Revolving Facilities ranges from 0.25% to 1.125% per annum for loans
accruing interest at the base rate. The credit spread for the Extended 2011 VML Term and Revolving Facilities ranges
from 1.25% to 2.125% per annum for loans accruing interest at an adjusted Eurodollar or HIBOR rate. Borrowings
under the 2012 Singapore Credit Facility bear interest at SOR plus a spread of 1.85% per annum, which is subject to
reduction based on a ratio of debt to Adjusted EBITDA. Borrowings under the airplane financings bear interest at
LIBOR plus 1.25% or 1.5% per annum.
Foreign currency transaction gains for the year ended December 31, 2014, were $1.8 million primarily due to
Singapore dollar denominated intercompany debt held in the U.S., partially offset by U.S. dollar denominated debt
held in Macao. We may be vulnerable to changes in the U.S. dollar/SGD and U.S. dollar/pataca exchange rates. Based
on balances as of December 31, 2014, an assumed 10% change in the U.S. dollar/SGD exchange rate would cause a
foreign currency transaction gain/loss of approximately $32.4 million and an assumed 1% change in the U.S. dollar/
pataca exchange rate would cause a foreign currency transaction gain/loss of approximately $13.7 million. We do not
hedge our exposure to foreign currencies; however, we maintain a significant amount of our operating funds in the
same currencies in which we have obligations thereby reducing our exposure to currency fluctuations.
See also “— Liquidity and Capital Resources” and “Item 8 — Financial Statements and Supplementary Data —
Notes to Consolidated Financial Statements — Note 8 — Long-Term Debt.”
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ITEM 8. — FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA
INDEX TO FINANCIAL STATEMENTS
Financial Statements:
Reports of Independent Registered Public Accounting Firms...........................................................................
Consolidated Balance Sheets at December 31, 2014 and 2013 .........................................................................
Consolidated Statements of Operations for each of the three years in the period ended December 31, 2014 ..
Consolidated Statements of Comprehensive Income for each of the three years in the period ended
December 31, 2014 ..........................................................................................................................................
Consolidated Statements of Equity for each of the three years in the period ended December 31, 2014 .........
Consolidated Statements of Cash Flows for each of the three years in the period ended December 31, 2014.
Notes to Consolidated Financial Statements......................................................................................................
Financial Statement Schedule:
Schedule II — Valuation and Qualifying Accounts ...........................................................................................
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76
77
78
79
80
82
140
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.
72
REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
To the Board of Directors and Stockholders of
Las Vegas Sands Corp.
We have audited the accompanying consolidated balance sheets of Las Vegas Sands Corp. and subsidiaries (the
"Company") as of December 31, 2014 and 2013, and the related consolidated statements of operations, comprehensive
income, equity, and cash flows for the years then ended. Our audits also included the financial information for the years
ended December 31, 2014 and 2013 in the financial statement schedule listed in the Index at Item 15(a)(2). These
financial statements and financial statement schedule are the responsibility of the Company’s management. Our
responsibility is to express an opinion on these financial statements and financial statement schedule based on our
audits. The consolidated financial statements of the Company for the year ended December 31, 2012, before the effects
of the retrospective adjustments to the Condensed Consolidating Financial Information for a change in the composition
of the Restricted Subsidiaries discussed in Note 18 to the consolidated financial statements, were audited by other
auditors whose report, dated March 1, 2013, expressed an unqualified opinion on those statements.
We conducted our audits in accordance with the standards of the Public Company Accounting Oversight Board (United
States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the
financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used
and significant estimates made by management, as well as evaluating the overall financial statement presentation. We
believe that our audits provide a reasonable basis for our opinion.
In our opinion, such 2014 and 2013 consolidated financial statements present fairly, in all material respects, the financial
position of Las Vegas Sands Corp. and subsidiaries at December 31, 2014 and 2013, and the results of their operations
and their cash flows for the years then ended, in conformity with accounting principles generally accepted in the United
States of America. Also, in our opinion, the information for the years ended December 31, 2014 and 2013 in the financial
statement schedule, when considered in relation to the basic consolidated financial statements taken as a whole for
those periods then ended, present fairly, in all material respects, the information set forth therein.
We have also audited the adjustments to Note 18 of the 2012 consolidated financial statements to retrospectively adjust
the Condensed Consolidating Financial Information for a change in the composition of Restricted Subsidiaries in 2013,
as discussed in Note 18 to the consolidated financial statements. Our procedures included (1) comparing the previously
reported consolidating financial information to previously issued consolidating financial information in Note 18, (2)
comparing the adjustments to the consolidating financial information to the Company’s underlying analysis, and (3)
testing the mathematical accuracy of the underlying analysis and the recast consolidating financial information. In our
opinion, such retrospective adjustments are appropriate and have been properly applied. However, we were not engaged
to audit, review, or apply any procedures to the 2012 consolidated financial statements of the Company other than with
respect to the retrospective adjustments and, accordingly, we do not express an opinion or any other form of assurance
on the 2012 consolidated financial statements taken as a whole.
We have also audited, in accordance with the standards of the Public Company Accounting Oversight Board (United
States), the Company's internal control over financial reporting as of December 31, 2014, based on the criteria established
in Internal Control-Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the
Treadway Commission and our report dated February 27, 2015 expressed an unqualified opinion on the Company's
internal control over financial reporting.
/s/ Deloitte & Touche LLP
Las Vegas, Nevada
February 27, 2015
73
REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
To the Board of Directors and Stockholders of
Las Vegas Sands Corp.
We have audited the internal control over financial reporting of Las Vegas Sands Corp. and subsidiaries (the "Company")
as of December 31, 2014, based on criteria established in Internal Control - Integrated Framework (2013) issued by
the Committee of Sponsoring Organizations of the Treadway Commission. The Company's management is responsible
for maintaining effective internal control over financial reporting and for its assessment of the effectiveness of internal
control over financial reporting, included in the accompanying Management's Annual Report on Internal Control over
Financial Reporting appearing under Item 9A. Our responsibility is to express an opinion on the Company's internal
control over financial reporting based on our audit.
We conducted our audit in accordance with the standards of the Public Company Accounting Oversight Board (United
States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether
effective internal control over financial reporting was maintained in all material respects. Our audit included obtaining
an understanding of internal control over financial reporting, assessing the risk that a material weakness exists, testing
and evaluating the design and operating effectiveness of internal control based on the assessed risk, and performing
such other procedures as we considered necessary in the circumstances. We believe that our audit provides a reasonable
basis for our opinion.
A company's internal control over financial reporting is a process designed by, or under the supervision of, the company's
principal executive and principal financial officers, or persons performing similar functions, and effected by the
company's board of directors, management, and other personnel to provide reasonable assurance regarding the reliability
of financial reporting and the preparation of financial statements for external purposes in accordance with generally
accepted accounting principles. A company's internal control over financial reporting includes those policies and
procedures that (1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the
transactions and dispositions of the assets of the company; (2) provide reasonable assurance that transactions are
recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting
principles, and that receipts and expenditures of the company are being made only in accordance with authorizations
of management and directors of the company; and (3) provide reasonable assurance regarding prevention or timely
detection of unauthorized acquisition, use, or disposition of the company's assets that could have a material effect on
the financial statements.
Because of the inherent limitations of internal control over financial reporting, including the possibility of collusion or
improper management override of controls, material misstatements due to error or fraud may not be prevented or
detected on a timely basis. Also, projections of any evaluation of the effectiveness of the internal control over financial
reporting to future periods are subject to the risk that the controls may become inadequate because of changes in
conditions, or that the degree of compliance with the policies or procedures may deteriorate.
In our opinion, the Company maintained, in all material respects, effective internal control over financial reporting as
of December 31, 2014, based on the criteria established in Internal Control - Integrated Framework (2013) issued by
the Committee of Sponsoring Organizations of the Treadway Commission.
We have also audited, in accordance with the standards of the Public Company Accounting Oversight Board (United
States), the consolidated financial statements and financial statement schedule as of December 31, 2014 and for the
year ended December 31, 2014 of the Company and our report dated February 27, 2015 expressed an unqualified
opinion on those financial statements and financial statement schedule.
/s/ Deloitte & Touche LLP
Las Vegas, Nevada
February 27, 2015
74
REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
To the Directors and Shareholders of Las Vegas Sands Corp.
In our opinion, the consolidated statements of operations, comprehensive income, of equity and cash flows for the year
ended December 31, 2012, before the effects of the adjustments to retrospectively reflect the change in the group of
subsidiaries that are the Restricted Subsidiaries described in Note 18, present fairly, in all material respects, the results
of Las Vegas Sands Corp. and its subsidiaries (the “Company”) operations and their cash flows for the year ended
December 31, 2012, in conformity with accounting principles generally accepted in the United States of America (the
2012 financial statements before the effects of the adjustments discussed in Note 18 are not presented herein). In
addition, in our opinion, the financial statement schedule for the year ended December 31, 2012 presents fairly, in all
material respects, the information set forth therein when read in conjunction with the related consolidated financial
statements before the effects of the adjustments described above. These financial statements and financial statement
schedule are the responsibility of the Company's management. Our responsibility is to express an opinion on these
financial statements and financial statement schedule based on our audit. We conducted our audit, before the effects
of the adjustments described above, of these statements in accordance with the standards of the Public Company
Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements are free of material misstatement. 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 audit provides a reasonable basis for our opinion.
We were not engaged to audit, review, or apply any procedures to the adjustments to retrospectively reflect the change
in the group of subsidiaries that are the Restricted Subsidiaries described in Note 18 and accordingly, we do not express
an opinion or any other form of assurance about whether such adjustments are appropriate and have been properly
applied. Those adjustments were audited by other auditors.
/s/ PricewaterhouseCoopers LLP
Florham Park, New Jersey
March 1, 2013
75
LAS VEGAS SANDS CORP. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
ASSETS
Current assets:
Cash and cash equivalents ............................................................................. $
Restricted cash and cash equivalents .............................................................
Accounts receivable, net ................................................................................
Inventories......................................................................................................
Prepaid expenses and other............................................................................
Total current assets................................................................................................
Property and equipment, net .................................................................................
Deferred financing costs, net ................................................................................
Deferred income taxes, net....................................................................................
Leasehold interests in land, net .............................................................................
Intangible assets, net .............................................................................................
Other assets, net ....................................................................................................
Total assets ............................................................................................................ $
LIABILITIES AND EQUITY
Current liabilities:
Accounts payable ........................................................................................... $
Construction payables....................................................................................
Accrued interest payable................................................................................
Other accrued liabilities .................................................................................
Deferred income taxes ...................................................................................
Income taxes payable.....................................................................................
Current maturities of long-term debt .............................................................
Total current liabilities ..........................................................................................
Other long-term liabilities .....................................................................................
Deferred income taxes ..........................................................................................
Deferred proceeds from sale of The Shoppes at The Palazzo...............................
Deferred gain on sale of The Grand Canal Shoppes .............................................
Deferred rent from mall sale transactions .............................................................
Long-term debt......................................................................................................
Total liabilities.......................................................................................................
Commitments and contingencies (Note 13)
Equity:
Common stock, $0.001 par value, 1,000,000,000 shares authorized,
829,280,328 and 827,273,217 shares issued, and 798,258,172 and
818,702,936 shares outstanding...................................................................
Treasury stock, at cost, 31,022,156 and 8,570,281 shares.............................
Capital in excess of par value ........................................................................
Accumulated other comprehensive income ...................................................
Retained earnings...........................................................................................
Total Las Vegas Sands Corp. stockholders’ equity...............................................
Noncontrolling interests ........................................................................................
Total equity............................................................................................................
Total liabilities and equity..................................................................................... $
December 31,
2014
2013
(In thousands,
except share data)
$
$
$
3,506,319
6,566
1,510,772
41,674
125,168
5,190,499
15,372,474
205,596
31,720
1,353,090
86,260
122,052
22,361,691
112,721
270,929
7,943
1,984,444
12,522
224,201
99,734
2,712,494
124,614
188,935
268,710
37,968
115,475
9,892,913
13,341,109
3,600,414
6,839
1,762,110
41,946
104,230
5,515,539
15,358,953
185,964
13,821
1,428,819
102,081
119,087
22,724,264
119,194
241,560
6,551
2,194,866
13,309
176,678
377,507
3,129,665
112,195
173,211
268,541
40,416
116,955
9,382,752
13,223,735
829
(2,237,952)
6,428,762
76,101
2,945,846
7,213,586
1,806,996
9,020,582
22,361,691
$
827
(570,520)
6,348,065
173,783
1,713,339
7,665,494
1,835,035
9,500,529
22,724,264
The accompanying notes are an integral part of these consolidated financial statements.
76
LAS VEGAS SANDS CORP. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS
Year Ended December 31,
2014
2013
2012
(In thousands, except share and per share data)
Revenues:
Casino..................................................................................... $ 12,004,361
1,540,420
Rooms.....................................................................................
778,769
Food and beverage .................................................................
553,534
Mall ........................................................................................
548,704
Convention, retail and other ...................................................
15,425,788
(841,939)
14,583,849
Less — promotional allowances ...................................................
Net revenues ...........................................................................
$ 11,386,917
1,380,681
730,259
481,400
515,179
14,494,436
(724,551)
13,769,885
$
9,008,158
1,154,024
628,528
396,927
497,032
11,684,669
(553,537)
11,131,132
Operating expenses:
Casino.....................................................................................
Rooms.....................................................................................
Food and beverage .................................................................
Mall ........................................................................................
Convention, retail and other ...................................................
Provision for doubtful accounts .............................................
General and administrative.....................................................
Corporate ................................................................................
Pre-opening ............................................................................
Development ..........................................................................
Depreciation and amortization ...............................................
Amortization of leasehold interests in land............................
Impairment loss ......................................................................
Loss on disposal of assets.......................................................
Operating income ..........................................................................
Other income (expense):
Interest income .......................................................................
Interest expense, net of amounts capitalized ..........................
Other income ..........................................................................
Loss on modification or early retirement of debt ...................
Income before income taxes..........................................................
Income tax expense .......................................................................
Net income.....................................................................................
Net income attributable to noncontrolling interests ......................
Net income attributable to Las Vegas Sands Corp........................ $
Earnings per share:
Basic ....................................................................................... $
Diluted.................................................................................... $
Weighted average shares outstanding:
6,705,534
256,835
392,560
69,732
320,759
186,722
1,258,133
174,750
26,230
14,325
1,031,589
40,598
—
6,856
10,484,623
4,099,226
25,643
(274,181)
1,965
(19,942)
3,832,711
(244,640)
3,588,071
(747,442)
2,840,629
3.52
3.52
Basic .......................................................................................
Diluted....................................................................................
Dividends declared per common share.......................................... $
806,130,838
808,019,219
2.00
6,483,718
271,942
369,570
73,358
317,869
237,786
1,329,740
189,535
13,339
15,809
1,007,468
40,352
—
11,156
10,361,642
3,408,243
16,337
(271,211)
4,321
(14,178)
3,143,512
(188,836)
2,954,676
(648,679)
2,305,997
2.80
2.79
822,282,515
826,316,108
1.40
$
$
$
$
$
$
$
$
5,128,036
237,303
331,210
68,763
304,263
239,332
1,061,935
207,030
143,795
19,958
892,046
40,165
143,674
2,240
8,819,750
2,311,382
23,252
(258,564)
5,740
(19,234)
2,062,576
(180,763)
1,881,813
(357,720)
1,524,093
1.89
1.85
806,395,660
824,556,036
3.75
The accompanying notes are an integral part of these consolidated financial statements.
77
LAS VEGAS SANDS CORP. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME
Year Ended December 31,
2014
2013
2012
Net income..................................................................................... $
Currency translation adjustment, net of reclassification
adjustment and before and after tax.............................................
Total comprehensive income.........................................................
Comprehensive income attributable to noncontrolling interests ...
Comprehensive income attributable to Las Vegas Sands Corp..... $
3,588,071
(98,414)
3,489,657
(746,710)
2,742,947
(In thousands)
2,954,676
$
$
1,881,813
(89,976)
2,864,700
(647,998)
2,216,702
$
172,788
2,054,601
(361,534)
1,693,067
$
The accompanying notes are an integral part of these consolidated financial statements.
78
LAS VEGAS SANDS CORP. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF EQUITY
Las Vegas Sands Corp. Stockholders' Equity
Common
Stock
Treasury
Stock
Capital in
Excess of
Par
Value
Accumulated
Other
Comprehensive
Income
Retained
Earnings
Noncontrolling
Interests
Total
$
733
—
— $ 5,610,160
—
—
$
94,104
$2,145,692
— 1,524,093
$
1,588,463
357,720
$ 9,439,152
1,881,813
—
2
—
1
88
—
—
—
—
—
—
—
—
—
—
—
—
—
40,038
63,102
(1)
528,820
(4,631)
—
—
—
—
168,974
—
—
—
—
—
—
—
—
—
3,814
6,200
3,264
—
—
172,788
46,240
66,366
—
528,908
—
—
— (3,090,757)
4,631
(357,056)
—
(3,447,813)
—
—
—
(10,466)
(10,466)
(18,576)
—
(18,576)
824
— 6,237,488
263,078
560,452
1,596,570
8,658,412
—
—
3
—
—
—
—
—
—
—
—
—
(570,520)
—
—
—
—
—
60,065
50,162
—
350
—
—
— 2,305,997
648,679
2,954,676
(89,295)
—
—
—
—
—
—
—
—
—
— (1,153,110)
(681)
9,528
4,156
—
—
(411,359)
(89,976)
69,596
54,318
(570,520)
350
(1,564,469)
—
—
(11,858)
(11,858)
827
(570,520)
6,348,065
173,783
1,713,339
1,835,035
9,500,529
—
—
2
—
—
—
—
—
—
—
— (1,667,432)
—
—
—
—
—
—
—
—
49,663
(12,365)
43,399
—
—
—
—
— 2,840,629
747,442
3,588,071
(97,682)
—
—
—
—
—
—
—
—
—
(732)
5,985
(98,414)
55,650
—
(12,365)
6,096
49,495
— (1,667,432)
—
—
— (1,608,122)
(487)
(776,570)
(487)
(2,384,692)
—
—
(9,773)
(9,773)
829
$(2,237,952) $ 6,428,762
$
76,101
$2,945,846
$
1,806,996
$ 9,020,582
Balance at January 1, 2012 .. $
Net income..............................
Currency translation
adjustment, net of
reclassification adjustment....
Exercise of stock options ........
Stock-based compensation......
Issuance of restricted stock .....
Exercise of warrants ...............
Acquisition of remaining
shares of noncontrolling
interest ..................................
Dividends declared .................
Distributions to
noncontrolling interests ........
Deemed distribution to
Principal Stockholder............
Balance at December 31,
2012 ......................................
Net income..............................
Currency translation
adjustment.............................
Exercise of stock options ........
Stock-based compensation......
Repurchase of common stock .
Exercise of warrants ...............
Dividends declared .................
Distributions to
noncontrolling interests ........
Balance at December 31,
2013 ......................................
Net income..............................
Currency translation
adjustment.............................
Exercise of stock options ........
Tax shortfall from stock-based
compensation ........................
Stock-based compensation......
Repurchase of common stock .
Disposition of interest in
majority owned subsidiary....
Dividends declared .................
Distributions to
noncontrolling interests ........
Balance at December 31,
2014 ...................................... $
The accompanying notes are an integral part of these consolidated financial statements.
79
LAS VEGAS SANDS CORP. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
Cash flows from operating activities:
Net income ......................................................................................... $
Adjustments to reconcile net income to net cash generated from
operating activities:
Depreciation and amortization ....................................................
Amortization of leasehold interests in land.................................
Amortization of deferred financing costs and original issue
discount .....................................................................................
Amortization of deferred gain on and rent from mall sale
transactions ...............................................................................
Non-cash change in deferred proceeds from sale of
The Shoppes at The Palazzo .....................................................
Non-cash loss on modification or early retirement of debt .........
Impairment and loss on disposal of assets ..................................
Stock-based compensation expense ............................................
Provision for doubtful accounts ..................................................
Foreign exchange gain ................................................................
Excess tax benefits from stock-based compensation ..................
Deferred income taxes ................................................................
Changes in operating assets and liabilities:
Accounts receivable ............................................................
Inventories ...........................................................................
Prepaid expenses and other .................................................
Leasehold interests in land ..................................................
Accounts payable ................................................................
Accrued interest payable .....................................................
Income taxes payable ..........................................................
Other accrued liabilities ......................................................
Net cash generated from operating activities .....................................
Cash flows from investing activities:
Change in restricted cash and cash equivalents ..................................
Capital expenditures ...........................................................................
Proceeds from disposal of property and equipment ...........................
Acquisition of intangible assets ..........................................................
Net cash used in investing activities ...................................................
Cash flows from financing activities:
Proceeds from exercise of stock options ............................................
Excess tax benefits from stock-based compensation ..........................
Repurchase of common stock ............................................................
Proceeds from exercise of warrants ....................................................
Dividends paid ...................................................................................
Distributions to noncontrolling interests ............................................
Deemed distribution to Principal Stockholder....................................
Proceeds from long-term debt (Note 8) ..............................................
Repayments of long-term debt (Note 8) .............................................
Payments of deferred financing costs .................................................
Net cash used in financing activities ..................................................
Effect of exchange rate on cash ..........................................................
Increase (decrease) in cash and cash equivalents ...............................
Cash and cash equivalents at beginning of year .................................
Cash and cash equivalents at end of year ........................................... $
80
Year Ended December 31,
2014
2013
2012
(In thousands)
3,588,071
$
2,954,676
$
1,881,813
1,031,589
40,598
1,007,468
40,352
50,978
(3,928)
985
15,345
6,856
48,058
186,722
(11,842)
(3,585)
(3,235)
37,411
(30)
(26,667)
(3,428)
(5,215)
1,683
60,706
(178,228)
4,832,844
270
(1,178,656)
1,818
—
(1,176,568)
55,650
3,585
(1,676,802)
—
(2,386,657)
(9,773)
—
2,497,725
(2,117,466)
(88,048)
(3,721,786)
(28,585)
(94,095)
3,600,414
3,506,319
$
56,792
(4,944)
1,376
3,255
11,156
53,377
237,786
(13,029)
—
(4,245)
(209,055)
1,113
(1,134)
(47,906)
13,777
(8,608)
18,911
328,294
4,439,412
(382)
(898,111)
32,155
(45,871)
(912,209)
69,596
—
(561,150)
350
(1,564,049)
(11,858)
—
3,183,107
(3,513,032)
(35,414)
(2,432,450)
(7,105)
1,087,648
2,512,766
3,600,414
$
892,046
40,165
50,476
(4,944)
1,732
16,313
145,914
65,428
239,332
(2,799)
—
5,188
(675,461)
(8,355)
(32,995)
(45,542)
788
(17,005)
47,309
458,354
3,057,757
693
(1,449,234)
2,909
—
(1,445,632)
46,240
—
—
528,908
(3,442,312)
(10,466)
(18,576)
4,351,486
(4,399,698)
(100,888)
(3,045,306)
43,229
(1,389,952)
3,902,718
2,512,766
LAS VEGAS SANDS CORP. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS (CONTINUED)
Year Ended December 31,
2014
2013
2012
(In thousands)
Supplemental disclosure of cash flow information:
Cash payments for interest, net of amounts capitalized ................ $
Cash payments for taxes, net of refunds........................................ $
Changes in construction payables ................................................. $
Non-cash investing and financing activities:
Capitalized stock-based compensation costs................................. $
Change in dividends payable on unvested restricted stock and
stock units included in other accrued liabilities .......................... $
Change in common stock repurchase payable included in other
accrued liabilities......................................................................... $
Disposition of interest in majority owned subsidiary.................... $
Acquisition of remaining shares of noncontrolling interest .......... $
Property and equipment acquired under capital lease ................... $
206,621
187,897
29,369
1,437
$
$
$
$
(1,965) $
(9,370) $
$
487
— $
— $
$
208,242
173,276
$
(101,812) $
209,091
115,045
(16,537)
941
420
$
$
9,370
$
— $
— $
$
2,761
938
5,501
—
—
4,631
10,109
The accompanying notes are an integral part of these consolidated financial statements.
81
LAS VEGAS SANDS CORP. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
Note 1 — Organization and Business of Company
Las Vegas Sands Corp. (“LVSC” or together with its subsidiaries, the “Company”) is incorporated in Nevada and
its common stock is traded on the New York Stock Exchange under the symbol “LVS.”
The ordinary shares of the Company’s subsidiary, Sands China Ltd. (“SCL,” the direct or indirect owner and
operator of the majority of the Company’s operations in the Macao Special Administrative Region (“Macao”) of the
People’s Republic of China), are listed on The Main Board of The Stock Exchange of Hong Kong Limited (“SEHK”).
The shares were not, and will not be, registered under the Securities Act of 1933, as amended, and may not be offered
or sold in the U.S. absent a registration under the Securities Act of 1933, as amended, or an applicable exception from
such registration requirements.
Operations
Macao
The Company currently owns 70.1% of SCL, which includes the operations of The Venetian Macao, Sands Cotai
Central, Four Seasons Macao, Sands Macao and other ancillary operations that support these properties, as further
discussed below. The Company operates the gaming areas within these properties pursuant to a 20-year gaming
subconcession, which expires in June 2022.
The Company owns and operates The Venetian Macao Resort Hotel (“The Venetian Macao”), which anchors the
Cotai Strip, the Company’s master-planned development of integrated resort properties on an area of approximately
140 acres in Macao. The Venetian Macao includes a 39-floor luxury hotel with over 2,900 suites; approximately 376,000
square feet of gaming space; a 15,000-seat arena; an 1,800-seat theater; a mall with retail and dining space of
approximately 925,000 square feet; and a convention center and meeting room complex of approximately 1.2 million
square feet.
The Company owns the Sands Cotai Central, an integrated resort situated across the street from The Venetian
Macao and Four Seasons Macao (which is further described below). In April 2012, the Company opened the first hotel
tower, consisting of approximately 600 five-star rooms and suites under the Conrad brand and approximately 1,200
four-star rooms and suites under the Holiday Inn brand. The Company also opened approximately 350,000 square feet
of meeting space; several food and beverage establishments; along with the 230,000-square-foot casino and VIP gaming
areas, all of which are operated by the Company. In September 2012, the Company opened the second hotel tower
consisting of approximately 1,800 rooms under the Sheraton brand and opened the second casino and additional retail,
entertainment, dining and meeting facilities, which are operated by the Company. In January 2013, the third hotel tower
opened, featuring approximately 2,100 rooms and suites under the Sheraton brand. The Company is constructing the
remaining phase of the integrated resort, which includes a fourth hotel and mixed-use tower under the St. Regis brand.
The total cost to complete the remaining phase is expected to be approximately $550 million. Upon completion of the
project, the integrated resort will feature approximately 370,000 square feet of gaming space, approximately 800,000
square feet of retail, entertainment and dining space, over 550,000 square feet of meeting facilities and a multipurpose
theater (to open in mid-2015). As of December 31, 2014, the Company has capitalized costs of $4.47 billion for the
entire project, including the land premium (net of amortization) and $70.3 million in outstanding construction payables.
The Company owns the Four Seasons Hotel Macao, Cotai Strip (the “Four Seasons Hotel Macao”), which features
360 rooms and suites managed and operated by Four Seasons Hotels Inc. and is located adjacent and connected to The
Venetian Macao. Connected to the Four Seasons Hotel Macao, the Company owns and operates the Plaza Casino
(together with the Four Seasons Hotel Macao, the “Four Seasons Macao”), which features approximately 105,000
square feet of gaming space; 19 Paiza mansions; retail space of approximately 258,000 square feet, which is connected
to the mall at The Venetian Macao; several food and beverage offerings; and conference, banquet and other facilities.
This integrated resort will also feature the Four Seasons Apartment Hotel Macao, Cotai Strip (the “Four Seasons
Apartments”), an apart-hotel tower that consists of approximately 1.0 million square feet of Four Seasons-serviced and
-branded luxury apart-hotel units and common areas. The Company has completed the structural work of the tower
and is advancing its plans to monetize units within the Four Seasons Apartments.
82
LAS VEGAS SANDS CORP. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (CONTINUED)
The Company owns and operates the Sands Macao, the first Las Vegas-style casino in Macao. The Sands Macao
offers approximately 241,000 square feet of gaming space and a 289-suite hotel tower, as well as several restaurants,
VIP facilities, a theater and other high-end services and amenities.
Singapore
The Company owns and operates the Marina Bay Sands in Singapore, which features three 55-story hotel towers
(totaling approximately 2,600 rooms and suites), the Sands SkyPark (which sits atop the hotel towers and features an
infinity swimming pool and several dining options), approximately 160,000 square feet of gaming space, an enclosed
retail, dining and entertainment complex of approximately 800,000 net leasable square feet, a convention center and
meeting room complex of approximately 1.2 million square feet, theaters and a landmark iconic structure at the bay-
front promenade that contains an art/science museum.
United States
Las Vegas
The Company owns and operates The Venetian Resort Hotel Casino (“The Venetian Las Vegas”), a Renaissance
Venice-themed resort; The Palazzo Resort Hotel Casino (“The Palazzo”), a resort featuring modern European ambience
and design; and an expo and convention center of approximately 1.2 million square feet (the “Sands Expo Center”).
These Las Vegas properties, situated on or near the Las Vegas Strip, form an integrated resort with approximately 7,100
suites; approximately 225,000 square feet of gaming space; a meeting and conference facility of approximately 1.1
million square feet; and the Grand Canal Shoppes, which consist of two enclosed retail, dining and entertainment
complexes that were sold to GGP Limited Partnership (“GGP,” see “— Note 12 — Mall Sales”).
Pennsylvania
The Company owns and operates the Sands Casino Resort Bethlehem (the “Sands Bethlehem”), a gaming, hotel,
retail and dining complex located on the site of the historic Bethlehem Steel Works in Bethlehem, Pennsylvania. Sands
Bethlehem features approximately 145,000 square feet of gaming space; a 300-room hotel tower; a 150,000-square-
foot retail facility; an arts and cultural center; and a 50,000-square-foot multipurpose event center. The Company owns
86% of the economic interest in the gaming, hotel and entertainment portion of the property through its ownership
interest in Sands Bethworks Gaming LLC and more than 35% of the economic interest in the retail portion of the
property through its ownership interest in Sands Bethworks Retail LLC.
Development Projects
Macao
The Company submitted plans to the Macao government for The Parisian Macao, an integrated resort that will
be connected to The Venetian Macao and Four Seasons Macao. The Parisian Macao is intended to include a gaming
area (to be operated under the Company’s gaming subconcession), a hotel with over 3,000 rooms and suites and retail,
entertainment, dining and meeting facilities. The Company has commenced construction and expects the cost to design,
develop and construct The Parisian Macao will be approximately $2.7 billion, inclusive of payments made for the land
premium. As with projects of this nature, the Company will continue to analyze options for both a full and phased
opening of the facility, which is anticipated to open in 2016, subject to Macao government approval. The Company
has capitalized costs of $804.3 million, including the land premium (net of amortization) and $90.2 million in outstanding
construction payables, as of December 31, 2014. In addition, the Company will be completing the development of some
public areas surrounding its Cotai Strip properties on behalf of the Macao government.
Under the Company’s land concession for The Parisian Macao, the Company is required to complete the
development by April 2016. The land concession for Sands Cotai Central contains a similar requirement that the
development be completed by December 2016. Should the Company determine that it is unable to complete The Parisian
Macao or Sands Cotai Central by their respective deadlines, the Company would expect to apply for another extension
83
LAS VEGAS SANDS CORP. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (CONTINUED)
from the Macao government. If the Company is unable to meet the current deadlines and the deadlines for either
development are not extended, the Company could lose its land concessions for The Parisian Macao or Sands Cotai
Central, which would prohibit the Company from operating any facilities developed under the respective land
concessions. As a result, the Company could record a charge for all or some portion of its $804.3 million or $4.47
billion in capitalized construction costs and land premiums (net of amortization), as of December 31, 2014, related to
The Parisian Macao and Sands Cotai Central, respectively.
United States
The Company was constructing a high-rise residential condominium tower (the “Las Vegas Condo Tower”),
located on the Las Vegas Strip between The Palazzo and The Venetian Las Vegas. The Company suspended construction
activities for the project due to reduced demand for Las Vegas Strip condominiums and the overall decline in general
economic conditions. The Company intends to recommence construction when demand and conditions improve. The
impact of the suspension on the estimated overall cost of the project is currently not determinable with certainty. Should
demand and conditions fail to improve or management decide to abandon the project, the Company could record a
charge for some portion of the $178.6 million in capitalized construction costs as of December 31, 2014.
Other
The Company continues to aggressively pursue new development opportunities globally.
Capital Financing Overview
Through December 31, 2014, the Company has funded its development projects primarily through borrowings
under its credit facilities, operating cash flows, proceeds from its equity offerings and proceeds from the disposition
of non-core assets.
The Company held unrestricted cash and cash equivalents of approximately $3.51 billion and restricted cash and
cash equivalents of $6.6 million as of December 31, 2014. The Company believes the cash on hand and cash flow
generated from operations will be sufficient to maintain compliance with the financial covenants of its credit facilities.
The Company may elect to arrange additional financing to fund the balance of its Cotai Strip developments. In the
normal course of its activities, the Company will continue to evaluate its capital structure and opportunities for
enhancements thereof. In March 2014, the Company amended its Macao credit facility, which extended a portion of
the term loans under the facility to March 2020 and provides for revolving loan commitments of $2.0 billion (see
“— Note 8 — Long-term Debt — Macao Related Debt — 2011 VML Credit Facility”). In August 2014, the Company
amended its Singapore credit facility, which extended the term loans under the facility to August 2020 and the revolving
loans under the facility to February 2020 (see “— Note 8 — Long-term Debt — Singapore Related Debt — 2012
Singapore Credit Facility”).
Note 2 — Summary of Significant Accounting Policies
Principles of Consolidation
The consolidated financial statements include the accounts of the Company, its majority-owned subsidiaries and
variable interest entities (“VIEs”) in which the Company is the primary beneficiary. All intercompany balances and
transactions have been eliminated in consolidation.
Management’s determination of the appropriate accounting method with respect to the Company’s variable
interests is based on accounting standards for VIEs issued by the Financial Accounting Standards Board (“FASB”).
The Company consolidates any VIEs in which it is the primary beneficiary and discloses significant variable interests
in VIEs of which it is not the primary beneficiary, if any.
The Company has entered into various joint venture agreements with independent third parties. The operations
of these joint ventures have been consolidated by the Company due to the Company’s significant investment in these
84
LAS VEGAS SANDS CORP. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (CONTINUED)
joint ventures, its power to direct the activities of the joint ventures that would significantly impact their economic
performance and the obligation to absorb potentially significant losses or the rights to receive potentially significant
benefits from these joint ventures. The Company evaluates its primary beneficiary designation on an ongoing basis and
will assess the appropriateness of the VIE’s status when events have occurred that would trigger such an analysis.
As of December 31, 2014 and 2013, the Company’s joint ventures had total assets of $85.0 million and $103.9
million, respectively, and total liabilities of $130.6 million and $125.4 million, respectively.
Use of Estimates
The preparation of the consolidated financial statements in conformity with accounting principles generally
accepted in the United States of America requires the Company 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.
These estimates and judgments are based on historical information, information that is currently available to the
Company and on various other assumptions that the Company believes to be reasonable under the circumstances. Actual
results could vary from those estimates.
Cash and Cash Equivalents
Cash and cash equivalents consist of cash and short-term investments with original maturities of less than 90 days.
Such investments are carried at cost, which is a reasonable estimate of their fair value. Cash equivalents are placed
with high credit quality financial institutions and are primarily in money market funds.
Accounts Receivable and Credit Risk
Accounts receivable are comprised of casino, hotel and other receivables, which do not bear interest and are
recorded at cost. The Company extends credit to approved casino customers following background checks and
investigations of creditworthiness. The Company also extends credit to its junkets in Macao, which receivables can be
offset against commissions payable to the respective junkets. Business or economic conditions, the legal enforceability
of gaming debts, or other significant events in foreign countries could affect the collectability of receivables from
customers and junkets residing in these countries.
The allowance for doubtful accounts represents the Company’s best estimate of the amount of probable credit
losses in the Company’s existing accounts receivable. The Company determines the allowance based on an analysis of
the collectability of each account with a balance over a specified dollar amount, based upon the age of the account, the
customer’s financial condition, collection history and any other known information, and the Company applies standard
reserve percentages to aged account balances under the specified dollar amount. Account balances are charged off
against the allowance when the Company believes it is probable the receivable will not be recovered. Management
believes that there are no concentrations of credit risk for which an allowance has not been established. Although
management believes that the allowance is adequate, it is possible that the estimated amount of cash collections with
respect to accounts receivable could change.
Inventories
Inventories consist primarily of food, beverage, retail products, and operating supplies, which are stated at the
lower of cost or market. Cost is determined by the weighted average and specific identification methods.
85
LAS VEGAS SANDS CORP. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (CONTINUED)
Property and Equipment
Property and equipment are stated at the lower of cost or fair value. Depreciation and amortization are provided
on a straight-line basis over the estimated useful lives of the assets, which do not exceed the lease term for leasehold
improvements, as follows:
Land improvements, building and building improvements.................................................................. 15 to 40 years
3 to 20 years
Furniture, fixtures and equipment.........................................................................................................
3 to 10 years
Leasehold improvements ......................................................................................................................
5 to 20 years
Transportation.......................................................................................................................................
The estimated useful lives are based on the nature of the assets as well as current operating strategy and legal
considerations such as contractual life. Future events, such as property expansions, property developments, new
competition or new regulations, could result in a change in the manner in which the Company uses certain assets
requiring a change in the estimated useful lives of such assets.
Maintenance and repairs that neither materially add to the value of the asset nor appreciably prolong its life are
charged to expense as incurred. Gains or losses on disposition of property and equipment are included in the consolidated
statements of operations.
The Company evaluates its property and equipment and other long-lived assets for impairment in accordance
with related accounting standards. For assets to be disposed of, the Company recognizes the asset to be sold at the
lower of carrying value or fair value less costs of disposal. Fair value for assets to be disposed of is estimated based
on comparable asset sales, solicited offers or a discounted cash flow model.
For assets to be held and used (including projects under development), fixed assets are reviewed for impairment
whenever indicators of impairment exist. If an indicator of impairment exists, the Company first groups its assets with
other assets and liabilities at the lowest level for which identifiable cash flows are largely independent of the cash flows
of other assets and liabilities (the “asset group”). Secondly, the Company estimates the undiscounted future cash flows
that are directly associated with and expected to arise from the completion, use and eventual disposition of such asset
group. The Company estimates the undiscounted cash flows over the remaining useful life of the primary asset within
the asset group. If the undiscounted cash flows exceed the carrying value, no impairment is indicated. If the undiscounted
cash flows do not exceed the carrying value, then an impairment is measured based on fair value compared to carrying
value, with fair value typically based on a discounted cash flow model. If an asset is still under development, future
cash flows include remaining construction costs.
To estimate the undiscounted cash flows of the Company’s asset groups, the Company considers all potential
cash flow scenarios, which are probability weighted based on management’s estimates given current conditions.
Determining the recoverability of the Company’s asset groups is judgmental in nature and requires the use of significant
estimates and assumptions, including estimated cash flows, probability weighting of potential scenarios, costs to
complete construction for assets under development, growth rates and future market conditions, among others. Future
changes to the Company’s estimates and assumptions based upon changes in macro-economic factors, regulatory
environments, operating results or management’s intentions may result in future changes to the recoverability of these
asset groups.
For assets to be held for sale, the fixed assets (the “disposal group”) are measured at the lower of their carrying
amount or fair value less cost to sell. Losses are recognized for any initial or subsequent write-down to fair value less
cost to sell, while gains are recognized for any subsequent increase in fair value less cost to sell, but not in excess of
the cumulative loss previously recognized. Any gains or losses not previously recognized that result from the sale of
the disposal group shall be recognized at the date of sale. Fixed assets are not depreciated while classified as held for
sale.
86
LAS VEGAS SANDS CORP. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (CONTINUED)
During the years ended December 31, 2014 and 2013, no assets were impaired. During December 31, 2012, the
Company recognized an impairment loss of $143.7 million, primarily related to $100.7 million of capitalized
construction costs related to the Company’s former Cotai Strip development (referred to as parcels 7 and 8) and a $42.9
million impairment due to the termination of ZAiA at The Venetian Macao.
Capitalized Interest and Internal Costs
Interest costs associated with major construction projects are capitalized and included in the cost of the projects.
When no debt is incurred specifically for construction projects, interest is capitalized on amounts expended using the
weighted average cost of the Company’s outstanding borrowings. Capitalization of interest ceases when the project is
substantially complete or construction activity is suspended for more than a brief period. During the years ended
December 31, 2014, 2013 and 2012, the Company capitalized interest expense of $9.3 million, $4.7 million and $49.3
million, respectively.
During the years ended December 31, 2014, 2013 and 2012, the Company capitalized approximately $32.6
million, $24.2 million and $20.3 million, respectively, of internal costs, consisting primarily of compensation expense
for individuals directly involved with the development and construction of property.
Deferred Financing Costs and Original Issue Discounts
Deferred financing costs and original issue discounts are amortized to interest expense based on the terms of the
related debt instruments using the effective interest method.
Leasehold Interests in Land
Leasehold interests in land represent payments made for the use of land over an extended period of time. The
leasehold interests in land are amortized on a straight-line basis over the expected term of the related lease agreements.
Indefinite Useful Life Assets
Assets with indefinite useful lives are regularly assessed to ensure they continue to meet the indefinite useful life
criteria. These assets are not subject to amortization and are tested for impairment and recoverability annually or more
frequently if events or circumstances indicate that the assets might be impaired. When performing the impairment
analysis, the Company may first conduct a qualitative assessment to determine whether it is “more-likely-than-not”
that the asset is impaired. If the Company elects to perform a qualitative assessment and it is determined that it is “more-
likely-than-not” that the asset is impaired after assessing the qualitative factors, the Company then performs an
impairment test that consists of a comparison of the fair value of the asset with its carrying amount. If the carrying
amount of the asset is not recoverable and exceeds its fair value, an impairment will be recognized in an amount equal
to that excess. If the carrying amount of the asset does not exceed the fair value, no impairment is recognized.
As of December 31, 2014, the Company had assets of $50.0 million and $16.5 million related to its Sands
Bethlehem gaming license and table games certificate, respectively, both of which were determined to have an indefinite
useful life and have been recorded within intangible assets in the accompanying consolidated balance sheets. For the
year ended December 31, 2014, the Company elected to perform a quantitative analysis given that the last quantitative
analysis performed was during the year ended December 31, 2011. The fair value of the Company’s gaming license
and table games certificate was estimated using the Company’s expected adjusted property EBITDA (as defined in “—
Note 17 — Segment Information”), combined with estimated future tax-affected cash flows and a terminal value using
the Gordon Growth Model, which were discounted to present value at rates commensurate with the Company’s capital
structure and the prevailing borrowing rates within the casino industry in general. Adjusted property EBITDA and
discounted cash flows are common measures used to value cash-intensive businesses such as casinos. Determining the
fair value of the gaming license and table games certificate is judgmental in nature and requires the use of significant
estimates and assumptions, including adjusted property EBITDA, growth rates, discount rates and future market
conditions, among others. For the years ended December 31, 2013 and 2012, the annual impairment analysis included
87
LAS VEGAS SANDS CORP. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (CONTINUED)
an assessment of certain qualitative factors including, but not limited to, the results of the most recent fair value
calculation, current year and projected operating results, and macro-economic and industry conditions. The Company
considered the qualitative factors and determined that it was not “more-likely-than-not” that the indefinite lived
intangible assets were impaired.
Future changes to the Company’s estimates and assumptions based upon changes in macro-economic factors,
operating results or management’s intentions may result in future changes to the fair value of the gaming license and
table games certificate. No impairment charge related to these assets was recorded for the years ended December 31,
2014, 2013 and 2012.
Revenue Recognition and Promotional Allowances
Casino revenue is the aggregate of gaming wins and losses. The commissions rebated directly or indirectly through
junkets to customers, cash discounts and other cash incentives to customers related to gaming play are recorded as a
reduction to gross casino revenue. Hotel revenue recognition criteria are met at the time of occupancy. Food and beverage
revenue recognition criteria are met at the time of service. 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 and are included in convention, retail
and other revenues. Mall revenue is primarily generated from base rents and overage rents received through long-term
leases with retail tenants. Base rent, adjusted for contractual escalations, is recognized on a straight-lined basis over
the term of the related lease. Overage rent is paid by a tenant when its sales exceed an agreed upon minimum amount
and is not recognized by the Company until the thresholds are met. Convention revenues are recognized when the
related service is rendered or the event is held.
In accordance with industry practice, the retail value of rooms, food and beverage, and other services furnished
to the Company’s guests without charge is included in gross revenue and then deducted as promotional allowances.
The estimated retail value of such promotional allowances is included in operating revenues as follows (in thousands):
Rooms............................................................................................ $
Food and beverage.........................................................................
Convention, retail and other ..........................................................
$
$
Year Ended December 31,
2013
366,353
222,195
136,003
724,551
$
$
$
2014
463,920
243,605
134,414
841,939
2012
256,738
185,292
111,507
553,537
The estimated departmental cost of providing such promotional allowances, which is included primarily in casino
operating expenses, is as follows (in thousands):
Rooms............................................................................................ $
Food and beverage.........................................................................
Convention, retail and other ..........................................................
$
Gaming Taxes
Year Ended December 31,
2013
$
$
88,379
167,223
88,214
343,816
$
$
2014
100,353
176,883
100,618
377,854
2012
62,201
140,403
73,106
275,710
The Company is subject to taxes based on gross gaming revenue in the jurisdictions in which it operates, subject
to applicable jurisdictional adjustments. These gaming taxes, including the goods and services tax in Singapore, are an
assessment on the Company’s gaming revenue and are recorded as a casino expense in the accompanying consolidated
88
LAS VEGAS SANDS CORP. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (CONTINUED)
statements of operations. These taxes were $4.65 billion, $4.54 billion and $3.53 billion for the years ended December 31,
2014, 2013 and 2012, respectively.
Frequent Players Program
The Company has established promotional clubs to encourage repeat business from frequent and active slot
machine customers and table games patrons. Members earn points primarily based on gaming activity and such points
can be redeemed for cash, free play and other free goods and services. The Company accrues for club points expected
to be redeemed for cash and free play as a reduction to gaming revenue and accrues for club points expected to be
redeemed for free goods and services primarily as casino expense. The accruals are based on estimates and assumptions
regarding the mix of cash, free play and other free goods and services that will be redeemed and the costs of providing
those benefits. Historical data is used to assist in the determination of the estimated accruals.
Pre-Opening and Development Expenses
The Company accounts for costs incurred in the development and pre-opening phases of new ventures in
accordance with accounting standards regarding start-up activities. Pre-opening expenses represent personnel and other
costs incurred prior to the opening of new ventures and are expensed as incurred. Development expenses include the
costs associated with the Company’s evaluation and pursuit of new business opportunities, which are also expensed as
incurred.
Advertising Costs
Costs for advertising are expensed the first time the advertising takes place or as incurred. Advertising costs
included in the accompanying consolidated statements of operations were $140.4 million, $117.8 million and $97.8
million for the years ended December 31, 2014, 2013 and 2012, respectively.
Corporate Expenses
Corporate expense represents payroll, travel, professional fees and various other expenses not allocated or directly
related to the Company’s integrated resort operations and related ancillary operations.
Foreign Currency
The Company accounts for currency translation in accordance with accounting standards regarding foreign
currency translation. Gains or losses from foreign currency remeasurements are included in other income (expense).
Balance sheet accounts are translated at the exchange rate in effect at each balance sheet date and income statement
accounts are translated at the average exchange rates during the year. Translation adjustments resulting from this process
are charged or credited to other comprehensive income.
Comprehensive Income and Accumulated Other Comprehensive Income
Comprehensive income includes net income and all other non-stockholder changes in equity, or other
comprehensive income. The balance of accumulated other comprehensive income consisted solely of foreign currency
translation adjustments. During the year ended December 31, 2012, a $6.6 million gain related to the dissolution of a
wholly owned foreign subsidiary was reclassified from accumulated other comprehensive income and comprehensive
income to net income. This amount is included in other income in the accompanying consolidated statements of
operations.
89
LAS VEGAS SANDS CORP. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (CONTINUED)
Earnings Per Share
The weighted average number of common and common equivalent shares used in the calculation of basic and
diluted earnings per share consisted of the following:
Weighted average common shares outstanding (used in the
calculation of basic earnings per share).......................................
Potential dilution from stock options, warrants and restricted
stock and stock units....................................................................
Weighted average common and common equivalent shares
(used in the calculation of diluted earnings per share) ................
Antidilutive stock options excluded from the calculation of
diluted earnings per share............................................................
Stock-Based Employee Compensation
Year Ended December 31,
2013
2012
2014
806,130,838
822,282,515
806,395,660
1,888,381
4,033,593
18,160,376
808,019,219
826,316,108
824,556,036
6,024,025
4,455,109
4,700,981
The Company accounts for its stock-based employee compensation in accordance with accounting standards
regarding share-based payment, which establishes accounting for equity instruments exchanged for employee services.
Stock-based compensation cost is measured at the grant date, based on the calculated fair value of the award, and is
recognized over the employee’s requisite service period (generally the vesting period of the equity grant). The Company’s
stock-based employee compensation plans are more fully discussed in “— Note 14 — Stock-Based Employee
Compensation.”
Income Taxes
The Company is subject to income taxes in the U.S. (including federal and state) and numerous foreign jurisdictions
in which it operates. The Company records income taxes under the asset and liability method, whereby deferred tax
assets and liabilities are recognized based on the future tax consequences attributable to temporary differences between
the financial statement carrying amounts of existing assets and liabilities and their respective tax bases, and attributable
to operating loss and tax credit carryforwards. Accounting standards regarding income taxes require a reduction of the
carrying amounts of deferred tax assets by a valuation allowance, if based on the available evidence, it is “more-likely-
than-not” that such assets will not be realized. Accordingly, the need to establish valuation allowances for deferred tax
assets is assessed at each reporting period based on a “more-likely-than-not” realization threshold. This assessment
considers, among other matters, the nature, frequency and severity of current and cumulative losses, forecasts of future
profitability, the duration of statutory carryforward periods, the Company’s experience with operating loss and tax
credit carryforwards not expiring, and tax planning strategies.
The Company recorded valuation allowances on the net deferred tax assets of certain foreign jurisdictions of
$215.2 million and $217.8 million, as of December 31, 2014 and 2013, respectively, and a valuation allowance on
certain deferred tax assets of its U.S. operations of $2.27 billion and $1.30 billion as of December 31, 2014 and 2013,
respectively, which increased during the current year primarily due to an increase in U.S. foreign tax credits. Management
will reassess the realization of deferred tax assets based on the accounting standards for income taxes each reporting
period and consider the scheduled reversal of deferred tax liabilities, sources of taxable income and tax planning
strategies. To the extent that the financial results of these operations improve and it becomes “more-likely-than-not”
that the deferred tax assets are realizable, the Company will be able to reduce the valuation allowance in the period
such determination is made.
Significant judgment is required in evaluating the Company’s tax positions and determining its provision for
income taxes. During the ordinary course of business, there are many transactions for which the ultimate tax
determination is uncertain. Accounting standards regarding uncertainty in income taxes provide a two-step approach
90
LAS VEGAS SANDS CORP. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (CONTINUED)
to recognizing and measuring uncertain tax positions. The first step is to evaluate the tax position for recognition by
determining if the weight of available evidence indicates it is “more-likely-than-not” that the position will be sustained
on audit, including resolution of related appeals or litigation processes, if any. The second step is to measure the tax
benefit as the largest amount, which is more than 50% likely, based solely on the technical merits, of being sustained
on examinations. The Company considers many factors when evaluating and estimating its tax positions and tax benefits,
which may require periodic adjustments and for which actual outcomes may be different.
Accounting for Derivative Instruments and Hedging Activities
Accounting standards require 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.
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, caps 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 results of operations in the period of change.
Otherwise, gains and losses are recognized in comprehensive income or loss 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.
Recent Accounting Pronouncements
In May 2014, the FASB issued an accounting standard update on revenue recognition that will be applied to all
contracts with customers. The update requires an entity to recognize revenue when it transfers promised goods or
services to customers in an amount that reflects what it expects in exchange for the goods or services. It also requires
more detailed disclosures to enable users of financial statements to understand the nature, amount, timing and uncertainty
of revenue and cash flows arising from contracts with customers. The guidance will be required to be applied on a
retrospective basis, using one of two methodologies, and will be effective for fiscal years beginning after December
15, 2016, with early application not being permitted. The Company is currently assessing the impact that the guidance
will have on the Company's financial condition and results of operations.
Note 3 — Accounts Receivable, Net
Accounts receivable consists of the following (in thousands):
Casino........................................................................................................................ $
Mall ...........................................................................................................................
Rooms .......................................................................................................................
Other..........................................................................................................................
Less — allowance for doubtful accounts ..................................................................
$
91
December 31,
2014
1,957,799
103,093
74,983
48,182
2,184,057
(673,285)
1,510,772
$
$
2013
2,110,749
125,761
106,935
48,392
2,391,837
(629,727)
1,762,110
LAS VEGAS SANDS CORP. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (CONTINUED)
Note 4 — Property and Equipment, Net
Property and equipment consists of the following (in thousands):
December 31,
Land and improvements............................................................................................ $
Building and improvements ......................................................................................
Furniture, fixtures, equipment and leasehold improvements ....................................
Transportation ...........................................................................................................
Construction in progress ...........................................................................................
Less — accumulated depreciation and amortization ................................................
Construction in progress consists of the following (in thousands):
2014
551,625
15,187,427
3,065,859
454,278
1,796,554
21,055,743
(5,683,269)
$ 15,372,474
$
2013
553,561
15,226,566
2,849,502
439,976
1,150,349
20,219,954
(4,861,001)
$ 15,358,953
The Parisian Macao................................................................................................... $
Four Seasons Macao (principally the Four Seasons Apartments).............................
Sands Cotai Central...................................................................................................
Other..........................................................................................................................
$
December 31,
2014
749,176
417,920
289,518
339,940
1,796,554
$
$
2013
318,914
394,404
111,704
325,327
1,150,349
The $339.9 million in other construction in progress consists primarily of construction of the Las Vegas Condo
Tower and various projects at The Venetian Macao.
In accordance with the April 2004 purchase and sale agreement, as amended, between Venetian Casino Resort,
LLC (“VCR”) and GGP (the “Amended Agreement”), the Company sold the portion of the Grand Canal Shoppes
located within The Palazzo (formerly referred to as "The Shoppes at the Palazzo," see “— Note 12 — Mall Sales —
The Shoppes at The Palazzo”). Under terms of the settlement with GGP on June 24, 2011, the Company retained the
$295.4 million of proceeds previously received and participates in certain potential future revenues earned by GGP.
Under generally accepted accounting principles, the transaction has not been accounted for as a sale because the
Company’s participation in certain potential future revenues constitutes continuing involvement in The Shoppes at The
Palazzo. Therefore, $266.2 million of the proceeds allocated to the mall sale transaction has been recorded as deferred
proceeds (a long-term financing obligation), which will accrue interest at an imputed rate and will be offset by (i) imputed
rental income and (ii) rent payments made to GGP related to spaces leased back from GGP by the Company. The
property and equipment legally sold to GGP totaling $228.5 million (net of $82.9 million of accumulated depreciation)
as of December 31, 2014, will continue to be recorded on the Company’s consolidated balance sheet and will continue
to be depreciated in the Company’s consolidated statement of operations.
The cost and accumulated depreciation of property and equipment that the Company is leasing to third parties,
primarily as part of its mall operations, was $1.13 billion and $251.0 million, respectively, as of December 31, 2014.
The cost and accumulated depreciation of property and equipment that the Company is leasing to these third parties
was $1.04 billion and $203.3 million, respectively, as of December 31, 2013.
The cost and accumulated depreciation of property and equipment that the Company is leasing under capital lease
arrangements was $38.4 million and $14.6 million, respectively, as of December 31, 2014. The cost and accumulated
depreciation of property and equipment that the Company is leasing under capital lease arrangements was $41.0 million
and $12.5 million, respectively, as of December 31, 2013.
92
LAS VEGAS SANDS CORP. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (CONTINUED)
During the years ended December 31, 2014 and 2013, no assets were impaired. In May 2012, the Company
withdrew its appeal regarding the Company’s application not being approved by the Macao government for a land
concession related to its Cotai Strip development (formerly referred to as parcels 7 and 8) and recorded an impairment
loss of $100.7 million during the year ended December 31, 2012, related to the capitalized construction costs of this
development. The Company also recorded a one-time impairment loss of $42.9 million related to the termination of
the ZAiA show at The Venetian Macao during the year ended December 31, 2012.
Note 5 — Leasehold Interests in Land, Net
Leasehold interests in land consist of the following (in thousands):
Marina Bay Sands ..................................................................................................... $
Sands Cotai Central...................................................................................................
The Venetian Macao..................................................................................................
Four Seasons Macao .................................................................................................
The Parisian Macao...................................................................................................
Sands Macao .............................................................................................................
Less — accumulated amortization ............................................................................
$
December 31,
2014
1,038,636
237,050
178,203
88,232
74,298
28,022
1,644,441
(291,351)
1,353,090
$
$
2013
1,083,249
236,588
176,536
87,620
74,102
27,795
1,685,890
(257,071)
1,428,819
The Company amortizes the leasehold interests in land on a straight-line basis over the expected term of the lease.
Amortization expense of $40.6 million, $40.4 million and $40.2 million was included in amortization of leasehold
interests in land expense for the years ended December 31, 2014, 2013 and 2012, respectively. The estimated future
amortization expense is approximately $39.4 million for each of the next five years and $1.40 billion thereafter at
exchange rates in effect on December 31, 2014.
Land concessions in Macao generally have an initial term of 25 years with automatic extensions of 10 years
thereafter in accordance with Macao law. The Company has received land concessions from the Macao government to
build on the sites on which The Venetian Macao, Four Seasons Macao and Sands Cotai Central are located and The
Parisian Macao is being constructed. The Company does not own these land sites in Macao; however, the land
concessions grant the Company exclusive use of the land. As specified in the land concessions, the Company is required
to pay premiums for each parcel, as well as annual rent for the term of the land concessions.
In addition to the land premium payments for the Macao leasehold interests in land, the Company is required to
make annual rent payments in the amounts and at the times specified in the land concessions. The rent amounts may
be revised every five years by the Macao government. As of December 31, 2014, the Company was obligated under
its land concessions to make future rental payments as follows (in thousands):
2015............................................................................................................................................. $
2016.............................................................................................................................................
2017.............................................................................................................................................
2018.............................................................................................................................................
2019.............................................................................................................................................
Thereafter ....................................................................................................................................
$
5,096
5,276
5,276
5,276
5,276
70,536
96,736
93
LAS VEGAS SANDS CORP. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (CONTINUED)
Note 6 — Intangible Assets, Net
Intangible assets consist of the following (in thousands):
December 31,
2014
2013
Sands Bethlehem gaming license and certificate ...................................................... $
66,500
$
66,500
Marina Bay Sands gaming license ............................................................................
Less — accumulated amortization ............................................................................
Trademarks and other................................................................................................
Less — accumulated amortization ............................................................................
Total intangible assets, net ........................................................................................ $
43,091
(24,139)
18,952
1,116
(308)
808
86,260
$
44,942
(10,195)
34,747
1,141
(307)
834
102,081
In August 2007 and July 2010, the Company was issued a gaming license and certificate from the Pennsylvania
Gaming Control Board for its slots and table games operations at Sands Bethlehem, respectively, which were acquired
for $50.0 million and $16.5 million, respectively. The license and certificate were determined to have indefinite lives
and therefore, are not subject to amortization. In April 2013, the Company paid 57.0 million Singapore dollars ("SGD,"
approximately $43.1 million at exchange rates in effect on December 31, 2014) to the Singapore Casino Regulatory
Authority (the “CRA”) as part of the process to renew its gaming license at Marina Bay Sands. This license is being
amortized over its three-year term, which expires in April 2016, and is renewable upon submitting an application,
paying the applicable license fee and meeting the requirements as determined by the CRA.
Amortization expense was $15.1 million, $13.6 million and $10.0 million for the years ended December 31,
2014, 2013 and 2012, respectively. The estimated future amortization expense is approximately $14.4 million and $4.6
million for the years ending December 2015 and 2016, respectively.
Note 7 — Other Accrued Liabilities
Other accrued liabilities consist of the following (in thousands):
Outstanding gaming chips and tokens ...................................................................... $
Customer deposits .....................................................................................................
Taxes and licenses.....................................................................................................
Payroll and related ....................................................................................................
Other accruals ...........................................................................................................
$
December 31,
2014
581,187
464,588
349,455
296,791
292,423
1,984,444
$
$
2013
572,121
450,550
570,111
308,404
293,680
2,194,866
94
LAS VEGAS SANDS CORP. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (CONTINUED)
Note 8 — Long-Term Debt
Long-term debt consists of the following (in thousands):
Corporate and U.S. Related:
2013 U.S. Credit Facility — Term B (net of original issue discount of $9,643 and
$11,250, respectively) ............................................................................................. $
2013 U.S. Credit Facility — Revolving....................................................................
Airplane Financings ..................................................................................................
HVAC Equipment Lease...........................................................................................
Other..........................................................................................................................
Macao Related:
2011 VML Credit Facility — Extended Term...........................................................
2011 VML Credit Facility — Term...........................................................................
2011 VML Credit Facility — Extended Revolving..................................................
Other..........................................................................................................................
Singapore Related:
2012 Singapore Credit Facility — Term...................................................................
Less — current maturities .........................................................................................
Total long-term debt.................................................................................................. $
December 31,
2014
2013
$
2,217,857
1,020,000
63,671
16,619
401
2,388,244
—
820,024
5,694
2,238,750
590,000
67,359
18,140
2,335
—
3,208,869
—
7,910
3,460,137
9,992,647
(99,734)
9,892,913
$
3,626,896
9,760,259
(377,507)
9,382,752
Corporate and U.S. Related Debt
2013 U.S. Credit Facility
In December 2013, the Company entered into a $3.5 billion senior secured credit facility (the “2013 U.S. Credit
Facility”), which consists of a $2.25 billion funded term B loan (the “2013 U.S. Term B Facility”) with an original
issue discount of $11.3 million and a $1.25 billion revolving credit facility (the “2013 U.S. Revolving Facility”). The
borrowings under the 2013 U.S. Credit Facility were used to repay the outstanding balance on the Senior Secured Credit
Facility (further described below). The Company recorded a $14.2 million loss on modification or early retirement of
debt during the year ended December 31, 2013. As of December 31, 2014, the Company had $224.3 million of available
borrowing capacity under the 2013 U.S. Revolving Facility, net of outstanding letters of credit.
The 2013 U.S. Term B Facility matures on December 19, 2020, and is subject to quarterly amortization payments
of $5.6 million, which began on March 31, 2014, followed by a balloon payment of $2.10 billion due on December 19,
2020. The 2013 U.S. Revolving Facility has no interim amortization payments and matures on December 19, 2018.
The 2013 U.S. Credit Facility is guaranteed by certain of the Company’s domestic subsidiaries (the “Guarantors”).
The obligations under the 2013 U.S. Credit Facility and the guarantees of the Guarantors are collateralized by a first-
priority security interest in substantially all of Las Vegas Sands, LLC (“LVSLLC”) and the Guarantors’ assets, other
than capital stock and similar ownership interests, certain furniture, fixtures and equipment, and certain other excluded
assets.
Borrowings under the 2013 U.S. Credit Facility bear interest, at the Company’s option, at either an adjusted
Eurodollar rate or at an alternative base rate, plus a credit spread. For base rate borrowings, the initial credit spread is
0.5% per annum and 1.5% per annum for the 2013 U.S. Revolving Facility and the 2013 U.S. Term B Facility,
respectively. For Eurodollar rate borrowings, the initial credit spread is 1.5% per annum and 2.5% per annum for the
2013 U.S. Revolving Facility and the 2013 U.S. Term B Facility (subject to a Eurodollar rate floor of 0.75%), respectively
95
LAS VEGAS SANDS CORP. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (CONTINUED)
(the interest rates were set at 1.7% and 3.3%, respectively, as of December 31, 2014). The weighted average interest
rate for the 2013 U.S Credit Facility was 2.8% and 2.9% during the years ended December 31, 2014 and 2013.
The Company pays a commitment fee of 0.35% per annum on the undrawn amounts under the 2013 U.S. Revolving
Facility, which will be reduced if certain corporate ratings are achieved, subject to certain additional conditions.
The 2013 U.S. Credit Facility contains affirmative and negative covenants customary for such financings,
including, but not limited to, limitations on incurring additional liens, incurring additional indebtedness, making certain
investments and acquiring and selling assets. The 2013 U.S. Credit Facility also requires the Guarantors to comply
with financial covenants, including, but not limited to, a maximum ratio of net debt outstanding to adjusted earnings
before interest, income taxes, depreciation and amortization, as defined (“Adjusted EBITDA”) to the extent there is an
outstanding balance on the 2013 U.S. Revolving Facility or certain letters of credit are outstanding. The maximum
leverage ratio is 5.5x for all applicable quarterly periods through maturity. The 2013 U.S. Credit Facility also contains
conditions and events of default customary for such financings. As of December 31, 2014, approximately $4.64 billion
of net assets of LVSLLC were restricted from being distributed under the terms of the 2013 U.S. Credit Facility.
Senior Secured Credit Facility
In May 2007, the Company entered into a $5.0 billion senior secured credit facility (the “Senior Secured Credit
Facility”), which originally consisted of $4.0 billion in funded and delayed draw term loans and a $1.0 billion revolving
credit facility (the “Revolving Facility”). As part of an amendment to the facility in August 2010, certain lenders elected
to extend the maturity of $1.91 billion in aggregate principal amount of the term loans (the “Extended Term Loans”)
and to extend the availability of $532.5 million of the Revolving Facility (the "Extended Revolving Facility"). As part
of the extension, the Company was required to pay down $1.0 billion in aggregate principal amount of the Extended
Term Loans and the commitments under the Revolving Facility were reduced from $1.0 billion to $750.0 million. In
addition to the pay down of $1.0 billion of the Extended Term Loans described above, the Company paid down $775.9
million under the Revolving Facility during the year ended December 31, 2010 and terminated the Revolving Facility
in December 2011. The Company paid down $400.0 million under the Senior Secured Credit Facility in June 2012 and
recorded a $1.6 million loss on early retirement of debt as a result during the year ended December 31, 2012.
Borrowings under the Senior Secured Credit Facility, as amended, bore interest, at the Company’s option, at
either an adjusted Eurodollar rate or at an alternative base rate, plus a credit spread. For base rate borrowings, the initial
credit spread was 0.75% per annum for the term loans and 1.25% per annum and 1.75% per annum for the Extended
Revolving Facility and the Extended Term Loans, respectively. For Eurodollar rate borrowings, the initial credit spread
was 1.75% per annum for the term loans and 2.25% per annum and 2.75% per annum for the Extended Revolving
Facility and Extended Term Loans, respectively. The weighted average interest rate for the Senior Secured Credit
Facility was 2.3% for the year ended December 31, 2013.
Senior Notes
In March 2012, the Company redeemed the remaining balance of its 6.375% senior notes (the "Senior Notes")
outstanding for $191.7 million and recorded a $2.8 million loss on early retirement of debt during the year ended
December 31, 2012.
Airplane Financings
In February 2007, the Company entered into promissory notes totaling $72.0 million to finance the purchase of
one airplane and to finance two others that the Company already owned. The notes consist of balloon payment promissory
notes and amortizing promissory notes, all of which have ten-year maturities and are collateralized by the related
aircraft. The notes bear interest at three-month London Inter-Bank Offered Rate (“LIBOR”) plus 1.5% per annum (set
at 1.8% as of December 31, 2014). The amortizing notes, totaling $28.8 million, are subject to quarterly amortization
payments of $0.7 million, which began June 1, 2007. The balloon notes, totaling $43.2 million, mature on March 1,
96
LAS VEGAS SANDS CORP. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (CONTINUED)
2017, and have no interim amortization payments. The weighted average interest rate on the notes was 1.8% during
the years ended December 31, 2014 and 2013.
In April 2007, the Company entered into promissory notes totaling $20.3 million to finance the purchase of an
additional airplane. The notes have ten-year maturities and consist of a balloon payment promissory note and an
amortizing promissory note. The notes bear interest at three-month LIBOR plus 1.25% per annum (set at 1.6% as of
December 31, 2014). The $8.1 million amortizing note is subject to quarterly amortization payments of $0.2 million,
which began June 30, 2007. The $12.2 million balloon note matures on March 31, 2017, and has no interim amortization
payments. The weighted average interest rate on the notes was 1.5% and 1.6% during the years ended December 31,
2014 and 2013, respectively.
HVAC Equipment Lease
In July 2009, the Company entered into a capital lease agreement with its current heating, ventilation and air
conditioning (“HVAC”) provider (the “HVAC Equipment Lease”) to provide the operation and maintenance services
for the HVAC equipment in Las Vegas. The lease has a 10-year term with a purchase option at the third, fifth, seventh
and tenth anniversary dates. The Company is obligated under the agreement to make monthly payments of approximately
$300,000 for the first year with automatic decreases of approximately $14,000 per month on every anniversary date.
The HVAC Equipment Lease was capitalized at the present value of the future minimum lease payments at lease
inception.
Macao Related Debt
2011 VML Credit Facility
On September 22, 2011, two subsidiaries of the Company, VML US Finance LLC, the Borrower, and Venetian
Macau Limited ("VML"), as guarantor, entered into a credit agreement (the “2011 VML Credit Facility”), which
provided for up to $3.7 billion (or equivalent in Hong Kong dollars or Macao patacas) and consisted of a $3.2 billion
term loan (the “2011 VML Term Facility”) that was fully drawn on November 15, 2011, and a $500.0 million revolving
facility (the “2011 VML Revolving Facility”), that was available until October 15, 2016. Borrowings under the facility
were used to repay outstanding indebtedness under previous credit facilities (the "VML Credit Facility" and the "VOL
Credit Facility") and would be used for working capital requirements and general corporate purposes, including for the
development, construction and completion of certain components of Sands Cotai Central.
During March 2014, the Company amended its 2011 VML Credit Facility to, among other things, modify certain
financial covenants, as discussed further below. In addition to the amendment, certain lenders extended the maturity
of $2.39 billion in aggregate principal amount of the 2011 VML Term Facility to March 31, 2020 (the "Extended 2011
VML Term Facility"), and, together with new lenders, provided $2.0 billion in aggregate principal amount of revolving
loan commitments (the "Extended 2011 VML Revolving Facility"). A portion of the revolving proceeds were used to
pay down the $819.7 million in aggregate principal balance of the 2011 VML Term Facility loans that were not extended.
The Company recorded an $18.0 million loss on modification or early retirement of debt during the year ended December
31, 2014, in connection with the pay down and extension. Borrowings under the Extended 2011 VML Revolving Facility
are being used to fund the development, construction and completion of Sands Cotai Central and The Parisian Macao,
and for working capital requirements and general corporate purposes. As of December 31, 2014, the Company had
$1.18 billion of available borrowing capacity under the Extended 2011 VML Revolving Facility.
The indebtedness under the 2011 VML Credit Facility is guaranteed by VML, Venetian Cotai Limited, Venetian
Orient Limited and certain of the Company’s other foreign subsidiaries (collectively, the “2011 VML Guarantors”).
The obligations under the 2011 VML Credit Facility are collateralized by a first-priority security interest in substantially
all of the Borrower’s and the 2011 VML Guarantors’ assets, other than (1) capital stock and similar ownership interests,
(2) certain furniture, fixtures, fittings and equipment and (3) certain other excluded assets.
97
LAS VEGAS SANDS CORP. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (CONTINUED)
Commencing with the quarterly period ending June 30, 2017, and at the end of each subsequent quarter through
March 31, 2018, the 2011 VML Credit Facility, as amended, requires the borrower to repay the outstanding Extended
2011 VML Term Facility on a pro rata basis in an amount equal to 2.5% of the aggregate principal amount outstanding
as of March 31, 2014 (the “Macao Restatement Date”). Commencing with the quarterly period ending on June 30,
2018, and at the end of each subsequent quarter through March 31, 2019, the borrower is required to repay the outstanding
Extended 2011 VML Term Facility on a pro rata basis in an amount equal to 5.0% of the aggregate principal amount
outstanding as of the Macao Restatement Date. For the quarterly periods ending on June 30 through December 31,
2019, the borrower is required to repay the outstanding Extended 2011 VML Term Facility on a pro rata basis in an
amount equal to 12.0% of the aggregate principal amount outstanding as of the Macao Restatement Date. The remaining
balance on the Extended 2011 VML Term Facility is due on the maturity date. The Extended 2011 VML Revolving
Facility has no interim amortization payments and matures on March 31, 2020.
Borrowings for all loans bear interest, as amended, at the Company's option, at either the adjusted Eurodollar
rate or Hong Kong Inter-bank Offered Rate (“HIBOR”), plus a credit spread, or an alternative base rate, plus a credit
spread, which credit spread in each case is determined based on the maximum leverage ratio as set forth in the credit
facility agreement, as amended. The credit spread for the Extended 2011 VML Term and Revolving Facilities ranges
from 0.25% to 1.125% per annum for loans accruing interest at the base rate. The credit spread for the Extended 2011
VML Term and Revolving Facilities ranges from 1.25% to 2.125% per annum for loans accruing interest at an adjusted
Eurodollar or HIBOR rate (interest rates set at 1.4% and 1.5%, respectively, as of December 31, 2014). On the Macao
Restatement Date, the credit spread for the Extended 2011 VML Term and Revolving Facilities was 0.375% per annum
for loans accruing interest at the base rate and 1.375% per annum for loans accruing interest at the adjusted Eurodollar
or HIBOR rate. The Borrower will also pay standby fees of 0.5% per annum on the undrawn amounts under the Extended
2011 VML Revolving Facility. The weighted average interest rate on the 2011 VML Credit Facility was 1.5% and 1.8%
for the years ended December 31, 2014 and 2013, respectively.
As of December 31, 2014, the Company had no interest rate cap agreements in place related to the 2011 VML
credit facility. As of December 31, 2013, the Company had interest rate cap agreements in place with a combined
notional amount of $1.60 billion, an expiration date of November 2014, and strike rates of 2.0% and 2.25%. As of
December 31, 2012, the Company had interest rate cap agreements in place with a combined notional amount of $1.70
billion, expiration dates ranging from September 2013 to November 2014, and strike rates of 2.0% and 3.5%. The
provisions of the interest rate cap agreements entitled the Company to receive from the counterparty the amounts, if
any, by which the selected market interest rates exceeded the strike rates as stated in such agreements. There was no
net effect on interest expense as a result of these interest rate cap agreements for the years ended December 31, 2014,
2013 and 2012.
The 2011 VML Credit Facility, as amended, contains affirmative and negative covenants customary for such
financings, including, but not limited to, limitations on liens, loans and guarantees, investments, acquisitions and asset
sales, restricted payments and other distributions, affiliate transactions, and use of proceeds from the facility. The 2011
VML Credit Facility also requires the Borrower and VML to comply with financial covenants, including maximum
ratios of total indebtedness to Adjusted EBITDA and minimum ratios of Adjusted EBITDA to net interest expense. The
maximum leverage ratio, as amended, is 4.5x for the quarterly periods ending December 31, 2014 through September
30, 2015, decreases to 4.0x for the quarterly periods ending December 31, 2015 through March 31, 2017, and then
decreases to, and remains at, 3.5x for all quarterly periods thereafter through maturity. The 2011 VML Credit Facility
also contains events of default customary for such financings.
Ferry Financing
In May 2012, the Company repaid the $131.6 million outstanding balance under its senior secured credit facility
(the "Ferry Financing") and recorded a $1.7 million loss on early retirement of debt during the year ended December 31,
2012.
98
LAS VEGAS SANDS CORP. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (CONTINUED)
Singapore Related Debt
2012 Singapore Credit Facility
In June 2012, the Company’s wholly owned subsidiary, Marina Bay Sands Pte. Ltd. (“MBS”), entered into a
SGD 5.1 billion (approximately $3.86 billion at exchange rates in effect on December 31, 2014) credit agreement (the
"2012 Singapore Credit Facility"), providing for a fully funded SGD 4.6 billion (approximately $3.48 billion at exchange
rates in effect on December 31, 2014) term loan (the “2012 Singapore Term Facility”) and a SGD 500.0 million
(approximately $378.0 million at exchange rates in effect on December 31, 2014) revolving facility (the “2012 Singapore
Revolving Facility”) that was available until November 25, 2017, which includes a SGD 100.0 million (approximately
$75.6 million at exchange rates in effect on December 31, 2014) ancillary facility (the “2012 Singapore Ancillary
Facility”). Borrowings under the 2012 Singapore Credit Facility were used to repay the outstanding balance under the
previous Singapore credit facility. The Company recorded a $13.1 million loss on modification or early retirement of
debt during the year ended December 31, 2012, as part of the refinancing of the facility.
In August 2014, the Company amended its 2012 Singapore Credit Facility, pursuant to which consenting lenders
of borrowings under the 2012 Singapore Term Facility extended the maturity to August 28, 2020, and consenting lenders
of borrowings under the 2012 Singapore Revolving Facility extended the maturity to February 28, 2020. The Company
recorded a $2.0 million loss on modification or early retirement of debt during the year ended December 31, 2014, in
connection with the extension. As of December 31, 2014, the Company had SGD 492.9 million (approximately $372.6
million at exchange rates in effect on December 31, 2014) of available borrowing capacity under the 2012 Singapore
Revolving Facility, net of outstanding letters of credit.
The indebtedness under the 2012 Singapore Credit Facility is collateralized by a first-priority security interest in
substantially all of MBS’s assets, other than capital stock and similar ownership interests, certain furniture, fixtures
and equipment and certain other excluded assets.
Commencing with the quarterly period ending December 31, 2014, and at the end of each subsequent quarter
through September 30, 2018, the Company is required to repay the outstanding 2012 Singapore Term Facility in the
amount of 0.5% of the aggregate principal amount outstanding as of August 29, 2014 (the "Singapore Restatement
Date"). Commencing with the quarterly period ending December 31, 2018, and at the end of each subsequent quarter
through September 30, 2019, the Company is required to repay the outstanding 2012 Singapore Term Facility in the
amount of 5.0% of the aggregate principal amount outstanding as of the Singapore Restatement Date. Commencing
with the quarterly period ending December 31, 2019, and at the end of each subsequent quarter through June 30, 2020,
and on the maturity date, the Company is required to repay the outstanding 2012 Singapore Term Facility in the amount
of 18.0% of the aggregate principal amount outstanding as of the Singapore Restatement Date. The 2012 Singapore
Revolving Facility has no interim amortization payments and matures on February 28, 2020.
Borrowings under the 2012 Singapore Credit Facility bear interest at the Singapore Swap Offered Rate ("SOR")
plus a spread of 1.85% per annum. Beginning December 23, 2012, the spread for all outstanding loans is subject to
reduction based on a ratio of debt to Adjusted EBITDA (interest rate set at approximately 2.1% as of December 31,
2014). MBS pays a standby commitment fee of 35% to 40% of the spread per annum on all undrawn amounts under
the 2012 Singapore Revolving Facility. The weighted average interest rate for the 2012 Singapore Credit Facility was
1.8% and 1.9% for the years ended December 31, 2014 and 2013, respectively.
As of December 31, 2014, the Company had interest rate cap agreements in place with a combined notional
amount of SGD 300 million (approximately $226.8 million at exchange rates in effect on December 31, 2014), expiration
dates ranging from April 2015 to May 2016 and strike rates of 3.0% and 3.5%. As of December 31, 2013, the Company
had interest rate cap agreements in place with a combined notional amount of SGD 1.45 billion (approximately $1.10
billion at exchange rates in effect on December 31, 2014), expiration dates ranging from May 2014 to May 2016 and
strike rates of 3.0% and 3.5%. As of December 31, 2012, the Company had interest rate cap agreements in place with
a combined notional amount of SGD 1.77 billion (approximately $1.33 billion at exchange rates in effect on December
99
LAS VEGAS SANDS CORP. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (CONTINUED)
31, 2014), expiration dates ranging from January 2013 to May 2015, and strike rates ranging from 3.0% to 4.5%. The
provisions of the interest rate cap agreements entitle the Company to receive from the counterparties the amounts, if
any, by which the selected market interest rates exceed the strike rates as stated in such agreements. There was no net
effect on interest expense as a result of these interest rate cap agreements for the years ended December 31, 2014, 2013
and 2012.
The 2012 Singapore Credit Facility, as amended, contains affirmative and negative covenants customary for such
financings, including, but not limited to, limitations on liens, indebtedness, loans and guarantees, investments,
acquisitions and asset sales, restricted payments, affiliate transactions and use of proceeds from the facilities. The 2012
Singapore Credit Facility also requires MBS to comply with financial covenants, including maximum ratios of total
indebtedness to Adjusted EBITDA, minimum ratios of Adjusted EBITDA to interest expense and a positive net worth
requirement. The maximum leverage ratio, as amended, is 3.5x for the quarterly periods ending December 31, 2014
through September 30, 2019, and then decreases to, and remains at, 3.0x for all quarterly periods thereafter through
maturity. The 2012 Singapore Credit Facility also contains events of default customary for such financings.
Cash Flows from Financing Activities
Cash flows from financing activities related to long-term debt and capital lease obligations are as follows (in
thousands):
$
2014
1,678,000
819,725
—
—
$
2,497,725
(1,270,500) $
(819,680)
(17,930)
—
—
—
(3,688)
—
Year Ended December 31,
2013
2,828,750
—
250,000
104,357
3,183,107
$
$
— $
—
(430,504)
(3,073,038)
—
—
(3,688)
—
2012
—
—
400,000
3,951,486
4,351,486
—
—
—
(425,555)
(3,635,676)
(189,712)
(3,688)
(140,337)
(5,668)
(2,117,466) $
(5,802)
(3,513,032) $
(4,730)
(4,399,698)
Proceeds from 2013 U.S. Credit Facility....................................... $
Proceeds from 2011 VML Credit Facility.....................................
Proceeds from Senior Secured Credit Facility ..............................
Proceeds from 2012 Singapore Credit Facility .............................
$
Repayments on 2013 U.S. Credit Facility ..................................... $
Repayments on 2011 VML Credit Facility....................................
Repayments on 2012 Singapore Credit Facility............................
Repayments on Senior Secured Credit Facility.............................
Repayments on Singapore Credit Facility.....................................
Redemption or repurchase and cancellation of Senior Notes........
Repayments on Airplane Financings.............................................
Repayments on Ferry Financing....................................................
Repayments on HVAC Equipment Lease and Other Long-Term
Debt .............................................................................................
$
100
LAS VEGAS SANDS CORP. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (CONTINUED)
Scheduled Maturities of Capital Lease Obligations and Long-Term Debt
Maturities of capital lease obligations and long-term debt outstanding as of December 31, 2014, are summarized
as follows (in thousands):
2015......................................................................................................................... $
2016.........................................................................................................................
2017.........................................................................................................................
2018.........................................................................................................................
2019.........................................................................................................................
Thereafter ................................................................................................................
Less — amount representing interest......................................................................
Total......................................................................................................................... $
Capital
Lease Obligations
5,368
4,824
3,448
2,357
11,561
—
27,558
(4,844)
22,714
Long-term
Debt
95,738
95,738
327,465
1,686,482
2,149,263
5,624,890
9,979,576
—
9,979,576
$
$
Fair Value of Long-Term Debt
The estimated fair value of the Company’s long-term debt as of December 31, 2014 and 2013, was approximately
$9.78 billion and $9.72 billion, respectively, compared to its carrying value of $9.98 billion and $9.74 billion,
respectively. The estimated fair value of the Company’s long-term debt is based on level 2 inputs (quoted prices in
markets that are not active).
Note 9 — Equity
Preferred Stock and Warrants
In November 2008, the Company issued 10,446,300 shares of its 10% Series A Cumulative Perpetual Preferred
Stock (the “Preferred Stock”) and warrants to purchase up to an aggregate of approximately 174,105,348 shares of
common stock at an exercise price of $6.00 per share and an expiration date of November 16, 2013 (the “Warrants”).
Units consisting of one share of Preferred Stock and one Warrant to purchase 16.6667 shares of common stock were
sold for $100 per unit. Of the 10,446,300 shares of Preferred Stock issued, the Company issued 5,196,300 shares to
the public together with Warrants to purchase up to an aggregate of approximately 86,605,173 shares of its common
stock. Of the 10,446,300 shares of Preferred Stock issued, the Company issued 5,250,000 shares to the Principal
Stockholder’s family together with Warrants to purchase up to an aggregate of approximately 87,500,175 shares of its
common stock. In November 2011, the Company redeemed all of the Preferred Stock outstanding.
During the year ended December 31, 2013, the remaining 3,500 Warrants issued to the public were exercised to
purchase an aggregate of 64,562 shares of the Company’s common stock at $6.00 per share and $0.3 million in cash
was received as settlement of the Warrant exercise price. During the year ended December 31, 2012, 39,070 Warrants
issued to the public were exercised to purchase an aggregate of 655,496 shares of the Company’s common stock at
$6.00 per share and $3.9 million in cash was received as settlement of the Warrant exercise price.
On March 2, 2012, the Principal Stockholder’s family exercised all of their outstanding Warrants to purchase
87,500,175 shares of the Company’s common stock for $6.00 per share and paid $525.0 million in cash as settlement
of the Warrant exercise price.
101
LAS VEGAS SANDS CORP. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (CONTINUED)
Common Stock
Dividends
On March 31, June 30, September 30 and December 29, 2014, the Company paid a dividend of $0.50 per common
share as part of a regular cash dividend program. During the year ended December 31, 2014, the Company recorded
$1.61 billion as a distribution against retained earnings (of which $863.3 million related to the Principal Stockholder’s
family and the remaining $744.8 million related to all other shareholders).
On March 29, June 28, September 27 and December 31, 2013, the Company paid a dividend of $0.35 per common
share as part of a regular cash dividend program. During the year ended December 31, 2013, the Company recorded
$1.15 billion as a distribution against retained earnings (of which $604.2 million related to the Principal Stockholder’s
family and the remaining $548.9 million related to all other shareholders).
On March 30, June 29, September 28 and December 28, 2012, the Company paid a dividend of $0.25 per common
share as part of a regular cash dividend program. On December 18, 2012, the Company paid a special cash dividend
of $2.75 per common share. During the year ended December 31, 2012, the Company recorded $3.09 billion as a
distribution against retained earnings (of which $1.62 billion related to the Principal Stockholder’s family and the
remaining $1.47 billion related to all other shareholders).
In January 2015, as part of a regular cash dividend program, the Company’s Board of Directors declared a quarterly
dividend of $0.65 per common share (a total estimated to be approximately $519 million) to be paid on March 31,
2015, to shareholders of record on March 23, 2015.
Repurchase Program
In June 2013, the Company’s Board of Directors approved a stock repurchase program with an initial authorization
of $2.0 billion, which expires in June 2015, but was completed during the year ended December 31, 2014. In October
2014, the Company's Board of Directors authorized the repurchase of an additional $2.0 billion of its outstanding
common stock, which expires in October 2016. Repurchases of the Company’s common stock are made at the Company’s
discretion in accordance with applicable federal securities laws in the open market or otherwise. The timing and actual
number of shares to be repurchased in the future will depend on a variety of factors, including the Company’s financial
position, earnings, legal requirements, other investment opportunities and market conditions. During the year ended
December 31, 2014 and 2013, the Company repurchased 22,406,655 and 8,570,281 shares, respectively, of its common
stock for $1.66 billion and $570.5 million, respectively, (including commissions) under this program. All share
repurchases of the Company’s common stock have been recorded as treasury stock.
102
LAS VEGAS SANDS CORP. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (CONTINUED)
Rollforward of Shares of Common Stock
A summary of the outstanding shares of common stock is as follows:
Balance as of January 1, 2012 .........................................................................................................
Exercise of stock options ..................................................................................................................
Issuance of restricted stock...............................................................................................................
Forfeiture of unvested restricted stock .............................................................................................
Exercise of warrants .........................................................................................................................
Balance as of December 31, 2012 ....................................................................................................
Exercise of stock options ..................................................................................................................
Issuance of restricted stock...............................................................................................................
Forfeiture of unvested restricted stock .............................................................................................
Repurchase of common stock...........................................................................................................
Exercise of warrants .........................................................................................................................
Balance as of December 31, 2013 ....................................................................................................
Exercise of stock options ..................................................................................................................
Issuance of restricted stock...............................................................................................................
Vesting of restricted stock units........................................................................................................
Forfeiture of unvested restricted stock .............................................................................................
Repurchase of common stock...........................................................................................................
Balance as of December 31, 2014 ....................................................................................................
733,249,698
2,387,831
516,556
(12,000)
88,155,671
824,297,756
2,777,127
146,848
(13,076)
(8,570,281)
64,562
818,702,936
1,955,108
31,137
29,541
(8,675)
(22,451,875)
798,258,172
Other Equity Transactions
In addition to the shares repurchased under the share repurchase program, during the year ended December 31,
2014, the Company repurchased 45,220 shares in satisfaction of tax withholding and exercise price obligations on
vested restricted stock and a stock option exercise.
In July 2012, the Company purchased a Boeing 747 airplane from an entity controlled by the Principal Stockholder
for $34.0 million, based on independent third party appraisals. In accordance with accounting standards regarding
transactions between entities under common control, the Company recorded the cost of the airplane at the Principal
Stockholder’s book value at the date of the transaction, which was $15.4 million. The $18.6 million difference between
the amount paid and the book value of the airplane (a gain to the Principal Stockholder) was recorded as a deemed
distribution to the Principal Stockholder during the year ended December 31, 2012.
The Company believes that the purchase of the airplane allows it to meet the increased demand for high-end
premium direct customer travel driven from the Company’s expanding global gaming operations and is an important
component in creating the ultimate trans-Pacific transportation experience for its customers. The Company believes it
would have been more costly to acquire the airplane in the open market due to the limited supply of similar aircraft
with luxury features.
Noncontrolling Interests
SCL
On February 26, 2014, SCL paid a dividend of 0.87 Hong Kong dollar ("HKD") per share and a special dividend
of HKD 0.77 per share, and, on June 30, 2014, paid a dividend of HKD 0.86 per share (a total of $2.60 billion) to SCL
shareholders (of which the Company retained $1.82 billion).
On February 28 and June 21, 2013, SCL paid a dividend of HKD 0.67 and HKD 0.66 per share, respectively (a
total of $1.38 billion), to SCL shareholders (of which the Company retained $970.2 million).
On February 28 and June 22, 2012, SCL paid a dividend of HKD 0.58 per share (a total of $1.20 billion) to SCL
shareholders (of which the Company retained $844.4 million).
103
LAS VEGAS SANDS CORP. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (CONTINUED)
In January 2015, the Board of Directors of SCL declared a dividend of HKD 0.99 per share (a total of $1.03
billion, of which the Company retained $722 million) to SCL shareholders of record on February 13, 2015, which was
paid on February 27, 2015.
Other
In April 2014, the Company disposed of its interest in one of its majority owned subsidiaries, resulting in a loss
of $0.5 million, which was included in loss on disposal of assets during the year ended December 31, 2014. In addition,
during the years ended December 31, 2014, 2013 and 2012, the Company distributed $9.8 million, $11.9 million and
$10.5 million, respectively, to certain of its noncontrolling interests.
Note 10 — Income Taxes
Consolidated income before taxes and noncontrolling interests for domestic and foreign operations is as follows
(in thousands):
Foreign........................................................................................... $
Domestic........................................................................................
Total income before income taxes................................................. $
2014
3,799,941
32,770
3,832,711
Year Ended December 31,
2013
3,109,982
33,530
3,143,512
$
$
$
$
2012
2,089,243
(26,667)
2,062,576
The components of the income tax expense are as follows (in thousands):
Foreign:
Current........................................................................................... $
Deferred.........................................................................................
Federal:
Current...........................................................................................
Deferred.........................................................................................
State:
Current...........................................................................................
Deferred.........................................................................................
Total income tax expense .............................................................. $
Year Ended December 31,
2013
2012
2014
252,476
(1,369)
$
195,154
(6,318)
$
163,199
17,848
(4,601)
(1,866)
(2,073)
2,073
—
—
244,640
$
—
—
188,836
$
12,379
(12,660)
(3)
—
180,763
104
LAS VEGAS SANDS CORP. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (CONTINUED)
The reconciliation of the statutory federal income tax rate and the Company’s effective tax rate is as follows:
Statutory federal income tax rate...................................................
Increase (decrease) in tax rate resulting from:
U.S. foreign tax credits..................................................................
Repatriation of foreign earnings....................................................
Change in valuation allowance......................................................
Foreign and U.S. tax rate differential ............................................
Tax exempt income of foreign subsidiary (Macao).......................
Change in uncertain tax positions..................................................
Other, net .......................................................................................
Effective tax rate............................................................................
Year Ended December 31,
2013
2012
2014
35.0 %
35.0 %
35.0 %
(80.3)%
53.6 %
26.7 %
(20.9)%
(8.5)%
— %
0.8 %
6.4 %
(19.0)%
14.6 %
6.0 %
(21.1)%
(9.6)%
— %
0.1 %
6.0 %
(162.1)%
110.5 %
54.3 %
(20.8)%
(10.0)%
0.7 %
1.2 %
8.8 %
The Company’s foreign and U.S. tax rate differential reflects the fact that income earned and reinvested in
Singapore and Macao is taxed at local rates, which are lower than U.S. tax rates. The Company received a 5-year income
tax exemption in Macao that exempts the Company from paying corporate income tax on profits generated by gaming
operations. The Company will continue to benefit from this tax exemption through the end of 2018. Had the Company
not received the income tax exemption in Macao, consolidated net income attributable to Las Vegas Sands Corp. would
have been reduced by $219.8 million, $207.7 million and $139.8 million, and diluted earnings per share would have
been reduced by $0.27, $0.25 and $0.17 per share for the years ended December 31, 2014, 2013 and 2012, respectively.
In May 2014, the Company entered into an agreement with the Macao government, effective through the end of 2018
that provides for an annual payment of 42.4 million patacas (approximately $5.3 million at exchange rates in effect on
December 31, 2014) that is a substitution for a 12% tax otherwise due from VML shareholders on dividend distributions
paid from VML gaming profits. In September 2013, the Company and the Internal Revenue Service ("IRS") entered
into a Pre-Filing Agreement providing that the Macao special gaming tax (35% of gross gaming revenue) qualifies as
a tax paid in lieu of an income tax and could be claimed as a U.S. foreign tax credit.
105
LAS VEGAS SANDS CORP. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (CONTINUED)
The primary tax affected components of the Company’s net deferred tax liabilities are as follows (in thousands):
Deferred tax assets:
U.S. foreign tax credit carryforwards........................................................................ $
Net operating loss carryforwards ..............................................................................
Pre-opening expenses................................................................................................
Stock-based compensation ........................................................................................
Accrued expenses......................................................................................................
Deferred gain on the sale of The Grand Canal Shoppes and The Shoppes at The
Palazzo ....................................................................................................................
Allowance for doubtful accounts ..............................................................................
State deferred items...................................................................................................
Other tax credit carryforwards ..................................................................................
Other..........................................................................................................................
Less — valuation allowances....................................................................................
Total deferred tax assets............................................................................................
Deferred tax liabilities:
Property and equipment ............................................................................................
Prepaid expenses .......................................................................................................
Other..........................................................................................................................
Total deferred tax liabilities ......................................................................................
Deferred tax liabilities, net........................................................................................ $
December 31,
2014
2013
$
2,257,048
255,623
32,773
31,565
31,563
1,280,121
245,652
39,409
46,952
36,746
31,412
30,861
12,361
2,059
5,443
2,690,708
(2,484,653)
206,055
33,008
26,392
14,109
181
6,362
1,728,932
(1,519,268)
209,664
(319,354)
(5,836)
(50,602)
(375,792)
(169,737) $
(338,284)
(8,966)
(35,113)
(382,363)
(172,699)
The Company recognizes tax benefits associated with stock-based compensation directly to stockholders’ equity
only when realized. Accordingly, deferred tax assets are not recognized for net operating loss carryforwards or credit
carryforwards resulting from windfall tax benefits. A windfall tax benefit occurs when the actual tax benefit realized
upon an employee’s disposition of a share-based award exceeds the cumulative book compensation charge associated
with the award. As of December 31, 2014 and 2013, the Company has windfall tax benefits of $354.6 million and
$273.1 million, respectively, which are not reflected in deferred tax assets. The Company uses a with-and-without
approach to determine if the excess tax deductions associated with compensation costs have reduced income taxes
payable.
During the year ended December 31, 2014, certain wholly owned foreign subsidiaries paid dividends resulting
in incremental U.S. taxable income. The receipt of the dividends did not result in a cash tax liability for the Company
as the incremental U.S. taxable income was fully offset by the utilization of the U.S. foreign tax credits generated as a
result of the dividends. In addition, the dividends generated excess U.S. foreign tax credits that will be available to be
carried forward to tax years beyond 2014. The Company’s U.S. foreign tax credit carryforwards were $2.43 billion and
$1.42 billion as of December 31, 2014 and 2013, respectively, which will begin to expire in 2021. The Company’s state
net operating loss carryforwards were $251.2 million and $242.1 million as of December 31, 2014 and 2013,
respectively, which will begin to expire in 2024. The Company’s U.S. general business credits were $2.1 million and
$0.2 million as of December 31, 2014 and 2013, respectively, which will begin to expire in 2032. There was a valuation
allowance of $2.27 billion and $1.30 billion as of December 31, 2014 and 2013, respectively, provided on certain net
U.S. deferred tax assets, as the Company believes these assets do not meet the “more-likely-than-not” criteria for
recognition. Net operating loss carryforwards for the Company’s foreign subsidiaries were $2.07 billion and $1.99
billion as of December 31, 2014 and 2013, respectively, which begin to expire in 2015. There are valuation allowances
of $215.2 million and $217.8 million, as of December 31, 2014 and 2013, respectively, provided on the net deferred
tax assets of certain foreign jurisdictions, as the Company believes these assets do not meet the “more-likely-than-not”
criteria for recognition.
106
LAS VEGAS SANDS CORP. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (CONTINUED)
Undistributed earnings of subsidiaries are accounted for as a temporary difference, except that deferred tax
liabilities are not recorded for undistributed earnings of foreign subsidiaries that are deemed to be indefinitely reinvested
in foreign jurisdictions. The Company has a plan for reinvestment of the undistributed earnings of its foreign subsidiaries
attributable to periods before January 1, 2014, which demonstrates such earnings will be indefinitely reinvested in the
applicable jurisdictions. The Company does not consider current year's tax earnings and profits of certain of its foreign
subsidiaries to be permanently reinvested. The Company has not provided deferred taxes for these foreign earnings as
the Company expects there will be sufficient creditable foreign taxes to offset the U.S. income tax that would result
from the repatriation of foreign earnings. As of December 31, 2014 and 2013, the amount of earnings and profits of
foreign subsidiaries that the Company does not intend to repatriate was $6.07 billion and $5.94 billion, respectively.
Should these earnings be distributed in the form of dividends or otherwise, the Company expects there will be sufficient
creditable foreign taxes to offset the U.S. income taxes and other foreign taxes that would result from a distribution.
The Company's cumulative temporary difference is less than its earnings and profits.
A reconciliation of the beginning and ending amounts of unrecognized tax benefits is as follows (in thousands):
Balance at the beginning of the year ............................................. $
Additions to tax positions related to prior years ....................
Reductions to tax positions related to prior years ..................
Additions to tax positions related to current year ..................
Settlements .............................................................................
Lapse in statutes of limitations...............................................
Balance at the end of the year........................................................ $
2014
December 31,
2013
2012
56,659
1,101
(462)
6,196
—
(729)
62,765
$
$
59,338
4,431
(12,063)
5,706
(753)
—
56,659
$
$
43,411
8,959
—
6,968
—
—
59,338
As of December 31, 2014 and 2013, unrecognized tax benefits of $50.6 million and $43.4 million, respectively,
were recorded as reductions to the U.S. foreign tax credit deferred tax asset. As of December 31, 2014, 2013 and 2012,
unrecognized tax benefits of $12.2 million, $13.3 million and $59.3 million, respectively, were recorded in other long-
term liabilities.
Included in the unrecognized tax benefit balance as of December 31, 2014, 2013 and 2012, are $52.4 million,
$47.3 million and $47.8 million, respectively, of uncertain tax benefits that would affect the effective income tax rate
if recognized.
The Company’s major tax jurisdictions are the U.S., Macao, and Singapore. The Company is subject to
examination for tax years beginning 2010 in the U.S., Macao and Singapore. The Inland Revenue Authority of Singapore
is performing a compliance review of the Marina Bay Sands tax returns for tax years 2010 through 2012. The Company
believes it has adequately reserved for its uncertain tax positions; however, there is no assurance that the taxing authorities
will not propose adjustments that are different from the Company’s expected outcome and that will impact the provision
for income taxes.
The Company recognizes interest and penalties, if any, related to unrecognized tax positions in the provision for
income taxes in the accompanying consolidated statement of operations. No interest or penalties were accrued as of
December 31, 2014 and 2013.
Note 11 — Fair Value Measurements
Under applicable accounting guidance, fair value is defined as the exit price, or the amount that would be received
to sell an asset or paid to transfer a liability in an orderly transaction between market participants as of the measurement
date. Applicable accounting guidance also establishes a valuation hierarchy for inputs in measuring fair value that
maximizes the use of observable inputs (inputs market participants would use based on market data obtained from
sources independent of the Company) and minimizes the use of unobservable inputs (inputs that reflect the Company’s
107
LAS VEGAS SANDS CORP. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (CONTINUED)
assumptions based upon the best information available in the circumstances) by requiring that the most observable
inputs be used when available. Level 1 inputs are quoted prices (unadjusted) in active markets for identical assets or
liabilities. Level 2 inputs are quoted prices for similar assets or liabilities in active markets, quoted prices for identical
or similar assets or liabilities in markets that are not active, and inputs (other than quoted prices) that are observable
for the assets or liabilities, either directly or indirectly. Level 3 inputs are unobservable inputs for the assets or liabilities.
Categorization within the hierarchy is based upon the lowest level of input that is significant to the fair value
measurement.
The following table provides the assets carried at fair value (in thousands):
Total Carrying
Value
Quoted Market
Prices in Active
Markets (Level 1)
Significant Other
Observable Inputs
(Level 2)
Significant
Unobservable Inputs
(Level 3)
Fair Value Measurements Using:
2,072,177
3
2,255,951
159
$
$
$
$
2,072,177
$
— $
2,255,951
$
— $
— $
$
3
— $
$
159
—
—
—
—
As of December 31, 2014
Cash equivalents(1) ........................... $
Interest rate caps(2) ........................... $
As of December 31, 2013
Cash equivalents(1) ........................... $
Interest rate caps(2) ........................... $
_________________________
(1) The Company has short-term investments classified as cash equivalents as the original maturities are less than
90 days.
(2) As of December 31, 2014 and 2013, the Company has 4 and 22 interest rate cap agreements, respectively, with
an aggregate fair value of approximately $3,000 and $0.2 million, respectively, based on quoted market values
from the institutions holding the agreements.
Note 12 — Mall Sales
The Grand Canal Shoppes at The Venetian Las Vegas
In April 2004, the Company entered into an agreement to sell the portion of the Grand Canal Shoppes located
within The Venetian Las Vegas (formerly referred to as "The Grand Canal Shoppes') and lease certain restaurant and
other retail space at the casino level of The Venetian Las Vegas (the “Master Lease”) to GGP for approximately $766.0
million (the “Mall Sale”). The Mall Sale closed in May 2004, and the Company realized a gain of $417.6 million in
connection with the Mall Sale. Under the Master Lease agreement, The Venetian Las Vegas leased nineteen retail and
restaurant spaces on its casino level to GGP for 89 years with annual rent of one dollar and GGP assumed the various
leases. In accordance with related accounting standards, the Master Lease agreement does not qualify as a sale of the
real property assets, which real property was not separately legally demised. Accordingly, $109.2 million of the
transaction has been deferred as prepaid operating lease payments to The Venetian Las Vegas, which will amortize into
income on a straight-line basis over the 89-year lease term. During each of the years ended December 31, 2014, 2013
and 2012, $1.2 million of this deferred item was amortized and included in convention, retail and other revenue. In
addition, the Company agreed with GGP to: (i) continue to be obligated to fulfill certain lease termination and asset
purchase agreements as further described in “— Note 13 — Commitments and Contingencies — Other Ventures and
Commitments”; (ii) lease theater space located within The Grand Canal Shoppes from GGP for a period of 25 years
with fixed minimum rent of $3.3 million per year with cost of living adjustments; (iii) operate the Gondola ride under
an operating agreement for a period of 25 years for an annual fee of $3.5 million; and (iv) lease certain office space
from GGP for a period of 10 years, subject to extension options for a period of up to 65 years, with annual rent of
approximately $0.9 million. The lease payments under clauses (ii) through (iv) above are subject to automatic increases
beginning on the sixth lease year. The net present value of the lease payments under clauses (ii) through (iv) on the
closing date of the sale was $77.2 million. In accordance with related accounting standards, a portion of the transaction
108
LAS VEGAS SANDS CORP. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (CONTINUED)
must be deferred in an amount equal to the present value of the minimum lease payments set forth in the lease back
agreements. This deferred gain will be amortized to reduce lease expense on a straight-line basis over the lives of the
leases. During the years ended December 31, 2014, 2013 and 2012, $3.1 million, $3.5 million and $3.5 million of this
deferred item was amortized as an offset to convention, retail and other expense.
As of December 31, 2014, the Company was obligated under (ii), (iii), and (iv) above to make future payments
as follows (in thousands):
2015 ...................................................................................................................................................... $
2016 ......................................................................................................................................................
2017 ......................................................................................................................................................
2018 ......................................................................................................................................................
2019 ......................................................................................................................................................
Thereafter..............................................................................................................................................
$
7,717
7,717
7,718
7,718
7,942
78,333
117,145
The Shoppes at The Palazzo
The Company contracted to sell a portion of the Grand Canal Shoppes (formerly referred to as The Shoppes at
The Palazzo) to GGP and under the terms of the settlement with GGP on June 24, 2011, the Company retained $295.4
million of proceeds received and participates in certain potential future revenues earned by GGP. Pursuant to the
Amended Agreement, the Company agreed with GGP to lease certain spaces located within The Shoppes at The Palazzo
for a period of 10 years with total fixed minimum rents of $0.7 million per year, subject to extension options for a
period of up to 10 years and automatic increases beginning on the second lease year. As of December 31, 2014, the
Company was obligated to make future payments of approximately $0.9 million for each of the three years ended
December 31, 2017, and approximately $0.5 million for the year ended December 31, 2018. In accordance with related
accounting standards, the transaction has not been accounted for as a sale because the Company’s participation in certain
potential future revenues constitutes continuing involvement in The Shoppes at The Palazzo. Therefore, $268.7 million
of the mall sale transaction has been recorded as deferred proceeds from the sale as of December 31, 2014, which
accrues interest at an imputed interest rate offset by (i) imputed rental income and (ii) rent payments made to GGP
related to those spaces leased back from GGP.
In the Amended Agreement, the Company agreed to lease certain restaurant and retail space on the casino level
of The Palazzo to GGP pursuant to a master lease agreement (“The Palazzo Master Lease”). Under The Palazzo Master
Lease, which was executed concurrently with, and as a part of, the closing on the sale of The Shoppes at The Palazzo
to GGP on February 29, 2008, The Palazzo leased nine restaurant and retail spaces on its casino level to GGP for
89 years with annual rent of one dollar and GGP assumed the various tenant operating leases for those spaces. In
accordance with related accounting standards, The Palazzo Master Lease does not qualify as a sale of the real property,
which real property was not separately legally demised. Accordingly, $22.5 million of the mall sale transaction has
been deferred as prepaid operating lease payments to The Palazzo, which is amortized into income on a straight-line
basis over the 89-year lease term.
Note 13 — Commitments and Contingencies
Litigation
The Company is involved in other litigation in addition to those noted below, arising in the normal course of
business. Management has made certain estimates for potential litigation costs based upon consultation with legal
counsel. Actual results could differ from these estimates; however, in the opinion of management, such litigation and
claims will not have a material effect on the Company’s financial condition, results of operations or cash flows.
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On October 15, 2004, Richard Suen and Round Square Company Limited ("RSC") filed an action against LVSC,
Las Vegas Sands, Inc. (“LVSI”), Sheldon G. Adelson and William P. Weidner in the District Court of Clark County,
Nevada (the “District Court”), asserting a breach of an alleged agreement to pay a success fee of $5.0 million and 2.0%
of the net profit from the Company’s Macao resort operations to the plaintiffs as well as other related claims. In
March 2005, LVSC was dismissed as a party without prejudice based on a stipulation to do so between the parties.
Pursuant to an order filed March 16, 2006, plaintiffs’ fraud claims set forth in the first amended complaint were dismissed
with prejudice against all defendants. The order also dismissed with prejudice the first amended complaint against
defendants Sheldon G. Adelson and William P. Weidner. On May 24, 2008, the jury returned a verdict for the plaintiffs
in the amount of $43.8 million. On June 30, 2008, a judgment was entered in this matter in the amount of $58.6 million
(including pre-judgment interest). The Company appealed the verdict to the Nevada Supreme Court. On November 17,
2010, the Nevada Supreme Court reversed the judgment and remanded the case to the District Court for a new trial. In
its decision reversing the monetary judgment against the Company, the Nevada Supreme Court also made several other
rulings, including overturning the pre-trial dismissal of the plaintiffs’ breach of contract claim and deciding several
evidentiary matters, some of which confirmed and some of which overturned rulings made by the District Court. On
February 27, 2012, the District Court set a date of March 25, 2013, for the new trial. On June 22, 2012, the defendants
filed a request to add experts and plaintiffs filed a motion seeking additional financial data as part of their discovery.
The District Court granted both requests. The retrial began on March 27 and on May 14, 2013, the jury returned a
verdict in favor of RSC in the amount of $70.0 million. On May 28, 2013, a judgment was entered in the matter in the
amount of $101.6 million (including pre-judgment interest). On June 7, 2013, the Company filed a motion with the
District Court requesting that the judgment be set aside as a matter of law or in the alternative that a new trial be granted.
On July 30, 2013, the District Court denied the Company’s motion. On October 17, 2013, the District Court entered
an order granting plaintiff’s request for certain costs and fees associated with the litigation in the amount of approximately
$1.0 million. On December 6, 2013, the Company filed a notice of appeal of the jury verdict with the Nevada Supreme
Court. The Company filed its opening appellate brief with the Nevada Supreme Court on June 16, 2014. On August
19, 2014, the Nevada Supreme Court issued an order granting plaintiffs additional time until September 15, 2014, to
file their answering brief. On September 15, 2014, RSC filed a request to the Nevada Supreme Court to file a brief
exceeding the maximum number of words, which was granted. On October 10, 2014, RSC filed their answering brief.
On January 9, 2015, the defendants filed their reply brief. The Company believes that it has valid bases in law and fact
to appeal these verdicts. As a result, the Company believes that the likelihood that the amount of the judgments will
be affirmed is not probable, and, accordingly, that the amount of any loss cannot be reasonably estimated at this time.
Because the Company believes that this potential loss is not probable or estimable, it has not recorded any reserves or
contingencies related to this legal matter. In the event that the Company’s assumptions used to evaluate this matter as
neither probable nor estimable change in future periods, it may be required to record a liability for an adverse outcome.
On October 20, 2010, Steven C. Jacobs, the former Chief Executive Officer of SCL, filed an action against LVSC
and SCL in the District Court alleging breach of contract against LVSC and SCL and breach of the implied covenant
of good faith and fair dealing and tortious discharge in violation of public policy against LVSC. On March 16, 2011,
an amended complaint was filed, which added Sheldon G. Adelson as a defendant and alleged a claim of defamation
per se against him, LVSC and SCL. On June 9, 2011, the District Court dismissed the defamation claim and certified
the decision as to Sheldon G. Adelson as a final judgment. On July 1, 2011, the plaintiff filed a notice of appeal regarding
the final judgment as to Sheldon G. Adelson. On August 26, 2011, the Nevada Supreme Court issued a writ of mandamus
instructing the District Court to hold an evidentiary hearing on whether personal jurisdiction exists over SCL and stayed
the case until after the District Court's decision. On January 17, 2012, Mr. Jacobs filed his opening brief with the Nevada
Supreme Court regarding his appeal of the defamation claim against Mr. Adelson. On January 30, 2012, Mr. Adelson
filed his reply to Mr. Jacobs’ opening brief. On March 8, 2012, the District Court set a hearing date for the week of
June 25-29, 2012, for the evidentiary hearing on personal jurisdiction over SCL. On May 24, 2012, the District Court
vacated the hearing date previously set for June 25-29 and set a status conference for June 28, 2012. At the June 28
status hearing, the District Court set out a hearing schedule to resolve a discovery dispute and did not reset a date for
the jurisdictional hearing. From September 10 to September 12, 2012, the District Court held a hearing to determine
the outcome of certain discovery disputes and issued an Order on September 14, 2012. In its Order, the District Court
fined LVSC $25,000 and, for the purposes of the jurisdictional discovery and evidentiary hearing, precluded the
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defendants from relying on the Macao Data Privacy Act as an objection or defense under its discovery obligations. On
December 21, 2012, the District Court ordered the defendants to produce documents from a former counsel to LVSC
containing attorney client privileged information. On January 23, 2013, the defendants filed a writ with the Nevada
Supreme Court challenging this order (the “January Writ”). On January 29, 2013, the District Court granted defendants'
motion for a stay of the order. On February 15, 2013, the Nevada Supreme Court ordered the plaintiff to answer the
January Writ. On February 28, 2013, the District Court ordered a hearing on plaintiff’s request for sanctions and
additional discovery (the “February 28th Order”). On April 8, 2013, the defendants filed a writ with the Nevada Supreme
Court challenging the February 28th Order (the “April Writ”); and the Nevada Supreme Court ordered the plaintiff to
answer the April Writ by May 20, 2013. The defendants also filed and were granted a stay of the February 28th Order
by the District Court until such time as the Nevada Supreme Court decides the April Writ. On June 18, 2013, the District
Court scheduled the jurisdictional hearing for July 16-22, 2013 and issued an order allowing the plaintiff access to
privileged communications of counsel to the Company (the “June 18th Order”). On June 21, 2013, the Company filed
another writ with the Nevada Supreme Court challenging the June 18th Order (the “June Writ”). The Nevada Supreme
Court accepted the June Writ on June 28, 2013, and issued a stay of the June 18th Order. On June 28, 2013, the District
Court vacated the jurisdictional hearing. On July 3, 2013, the Company filed a motion with the Nevada Supreme Court
to consolidate the pending writs (each of which have been fully briefed to the Nevada Supreme Court as of the date of
this filing). On October 9, 2013, the Nevada Supreme Court heard arguments on the January Writ and plaintiff’s appeal
of the District Court's dismissal of plaintiff’s defamation claim against Mr. Adelson. The Nevada Supreme Court has
taken both matters under advisement pending a decision. On January 29, 2014, the defendants filed Supplemental
Authority and a Motion to Recall Mandate with the Nevada Supreme Court to (i) inform the Nevada Supreme Court
of a recently decided U.S. Supreme Court case involving similar jurisdictional issues to this matter and (ii) given this
new precedent, to review anew its August 26, 2011, writ of mandamus to the District Court, respectively. On February
27, 2014, the Nevada Supreme Court ruled in favor of the Company on the January Writ, which became effective on
March 24, 2014. On March 3, 2014, the Nevada Supreme Court heard oral arguments on the April and June Writs. On
May 30, 2014, the Nevada Supreme Court overturned the District Court’s dismissal of Mr. Jacob’s defamation claim
against Mr. Adelson and remanded the claim for further determination. On June 17, 2014, Mr. Adelson filed a petition
for rehearing with the Nevada Supreme Court and, on June 20, 2014, the Nevada Supreme Court ordered Mr. Jacobs
to answer the petition for rehearing, which he did on July 7, 2014. On June 26, 2014, SCL filed a Motion for Summary
Judgment with respect to jurisdiction with the District Court, which was denied on July 29, 2014. On June 30, 2014,
Mr. Jacobs filed a motion for leave to file a second amended complaint. The defendants filed a notice of intent to oppose
the motion for leave to file the second amended complaint. On July 1, 2014, Mr. Jacobs filed a motion to reconsider
the dismissal of the defamation claim. On July 3, 2014, Mr. Adelson filed a notice of intent to oppose the motion to
reconsider and requested oral argument. Also on July 3, 2014, the defendants filed a motion to continue the stay of the
District Court’s March 26, 2013, order compelling the production of documents from Macao and a notice of intent to
oppose plaintiff’s motion to reconsider the dismissal of his defamation claim against LVSC and SCL. On July 22, 2014,
the defendants filed a motion for leave to file a reply in support of their petition for rehearing on the defamation claim
with the Nevada Supreme Court. On July 22, 2014, SCL filed its reply in support of its Motion for Summary Judgment
on jurisdiction and opposition to plaintiff’s counter Motion for Summary Judgment. On July 25, 2014, the Nevada
Supreme Court granted defendants’ motion for leave to file a reply. On July 29, 2014, the Nevada Supreme Court heard
the Motions for Summary Judgment and denied them both. On August 7, 2014, the Nevada Supreme Court denied the
writ challenging the District Court’s order on plaintiff’s March 26, 2013, Renewed Motion for Sanctions. On August
7, 2014, the Nevada Supreme Court granted in part defendants’ writ with respect to the District Court’s June 19, 2013,
order requiring the production of privileged material. On August 7, 2014, the Nevada Supreme Court also denied
rehearing on its reversal of the dismissal of the defamation claim by a vote of 4-3. On August 13, 2014, the District
Court ruled that plaintiff may amend his complaint except for the defamation claim against Mr. Adelson until the
remittitur from the Nevada Supreme Court is received. The District Court also allowed the sanctions hearing to move
forward and is reviewing documents in camera to determine whether they were properly withheld on privilege grounds.
On September 4, 2014, SCL filed its pre-hearing memorandum regarding the sanctions hearing regarding plaintiff’s
March 26, 2013, Renewed Motion for Sanctions. On September 12, 2014, the plaintiff filed a motion for release of the
privileged documents from the District Court appointed document custodian on the grounds of waiver. On September
16, 2014, the plaintiff filed a motion seeking to stop defendants from modifying their privilege log and seeking a waiver
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of all privilege claims as a result of alleged deficiencies in the original privilege log. On September 26, 2014, after the
Nevada Supreme Court issued its remittitur, plaintiff filed his motion for leave to file a third amended complaint against
LVSC, SCL and Mr. Adelson. On September 26, 2014, the defendants filed their opposition to plaintiff’s motion for
release of documents on the grounds of waiver. On October 3, 2014, plaintiff filed his reply in support of his two waiver
motions relating to the documents held by the District Court appointed custodian. On October 9, 2014, the District
Court granted plaintiff's motion in part and denied the remainder. On October 17, 2014, SCL filed a motion to reconsider
the District Court’s March 27, 2013, order concerning a discovery dispute. On October 10, 2014, Mr. Adelson filed his
opposition to plaintiff's motion to file a third amended complaint, which SCL and LVSC joined on October 14, 2014.
On October 30, 2014, the plaintiff filed his reply in support of his motion to file a third amended complaint. On November
5, 2014, the District Court ordered that SCL waived privilege on three confidential reports. On November 7, 2014, the
District Court granted plaintiff's motion to file a third amended complaint. On November 7, 2014, defendants filed a
motion for partial re-consideration of the November 5, 2014, order waiving privilege. On January 6, 2015, the District
Court scheduled a sanctions hearing for February 9, 2015, and the evidentiary hearing on jurisdiction for April 20,
2015. On January 12, 2015, defendants each filed their motions to dismiss the third amended complaint. Mr. Jacobs is
seeking unspecified damages. This action is in a preliminary stage and management has determined that based on
proceedings to date, it is currently unable to determine the probability of the outcome of this matter or the range of
reasonably possible loss, if any. The Company intends to defend this matter vigorously.
On February 9, 2011, LVSC received a subpoena from the Securities and Exchange Commission (the “SEC”)
requesting that the Company produce documents relating to its compliance with the Foreign Corrupt Practices Act (the
“FCPA”). The Company has also been advised by the Department of Justice (the “DOJ”) that it is conducting a similar
investigation. It is the Company’s belief that the subpoena may have emanated from the lawsuit filed by Steven C.
Jacobs described above.
After the Company’s receipt of the subpoena from the SEC on February 9, 2011, the Board of Directors delegated
to the Audit Committee, comprised of three independent members of the Board of Directors, the authority to investigate
the matters raised in the SEC subpoena and related inquiry of the DOJ.
As part of the 2012 annual audit of the Company’s financial statements, the Audit Committee advised the Company
and its independent accountants that it had reached certain preliminary findings, including that there were likely
violations of the books and records and internal controls provisions of the FCPA and that in recent years, the Company
has improved its practices with respect to books and records and internal controls.
Based on the information provided to management by the Audit Committee and its counsel, the Company believes,
and the Audit Committee concurs, that the preliminary findings:
•
•
•
do not have a material impact on the financial statements of the Company;
do not warrant any restatement of the Company’s past financial statements; and
do not represent a material weakness in the Company’s internal controls over financial reporting as of
December 31, 2014.
The investigation by the Audit Committee is complete. The Company is cooperating with all investigations. Based
on proceedings to date, management is currently unable to determine the probability of the outcome of this matter, the
extent of materiality, or the range of reasonably possible loss, if any.
On May 24, 2010, Frank J. Fosbre, Jr. filed a purported class action complaint in the United States District Court
for the District of Nevada (the “U.S. District Court”), against LVSC, Sheldon G. Adelson, and William P. Weidner. The
complaint alleged that LVSC, through the individual defendants, disseminated or approved materially false information,
or failed to disclose material facts, through press releases, investor conference calls and other means from August 1,
2007 through November 6, 2008. The complaint sought, among other relief, class certification, compensatory damages
and attorneys’ fees and costs. On July 21, 2010, Wendell and Shirley Combs filed a purported class action complaint
in the U.S. District Court, against LVSC, Sheldon G. Adelson, and William P. Weidner. The complaint alleged that
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LVSC, through the individual defendants, disseminated or approved materially false information, or failed to disclose
material facts, through press releases, investor conference calls and other means from June 13, 2007 through
November 11, 2008. The complaint, which was substantially similar to the Fosbre complaint, discussed above, sought,
among other relief, class certification, compensatory damages and attorneys’ fees and costs. On August 31, 2010, the
U.S. District Court entered an order consolidating the Fosbre and Combs cases, and appointed lead plaintiffs and lead
counsel. As such, the Fosbre and Combs cases are reported as one consolidated matter. On November 1, 2010, a
purported class action amended complaint was filed in the consolidated action against LVSC, Sheldon G. Adelson and
William P. Weidner. The amended complaint alleges that LVSC, through the individual defendants, disseminated or
approved materially false and misleading information, or failed to disclose material facts, through press releases, investor
conference calls and other means from August 2, 2007 through November 6, 2008. The amended complaint seeks,
among other relief, class certification, compensatory damages and attorneys’ fees and costs. On January 10, 2011, the
defendants filed a motion to dismiss the amended complaint, which, on August 24, 2011, was granted in part, and denied
in part, with the dismissal of certain allegations. On November 7, 2011, the defendants filed their answer to the allegations
remaining in the amended complaint. On July 11, 2012, the U.S. District Court issued an order allowing defendants’
Motion for Partial Reconsideration of the court’s order dated August 24, 2011, striking additional portions of the
plaintiff’s complaint and reducing the class period to a period of February 4 to November 6, 2008. On August 7, 2012,
the plaintiff filed a purported class action second amended complaint (the “Second Amended Complaint”) seeking to
expand their allegations back to a time period of 2007 (having previously been cut back to 2008 by the U.S. District
Court) essentially alleging very similar matters that had been previously stricken by the U.S. District Court. On
October 16, 2012, the defendants filed a new motion to dismiss the Second Amended Complaint. The plaintiffs
responded to the motion to dismiss on November 1, 2012, and defendants filed their reply on November 12, 2012. On
November 20, 2012, the U.S. District Court granted a stay of discovery under the Private Securities Litigation Reform
Act pending a decision on the new motion to dismiss and therefore, the discovery process has been suspended. On
April 16, 2013, the case was reassigned to a new judge. On July 30, 2013, the U.S. District Court heard the motion to
dismiss and took the matter under advisement. On November 7, 2013, the judge granted in part and denied in part
defendants' motions to dismiss. On December 13, 2013, the defendants filed their answer to the Second Amended
Complaint. Discovery in the matter has re-started. On January 8, 2014, plaintiffs filed a motion to expand the certified
class period. On February 3, 2014, the judge agreed to the parties' stipulation to defer briefing on the issue of expanding
the class period until the U.S. Supreme Court issues a decision in the case of Halliburton Co. v. Erica P. John Fund,
Inc. On September 26, 2014, the U.S. Supreme Court denied plaintiffs' motion to expand the class period without
prejudice to re-filing a similar motion. The U.S. Supreme Court decided the Halliburton case on June 23, 2014, and,
on October 3, 2014, the parties stipulated to a case management schedule wherein they agree to a briefing schedule on
class certification. On November 7, 2014, plaintiffs filed a motion to expand the class period and on January 9, 2015,
defendants filed their opposition to the motion. This consolidated action is in a preliminary stage and management has
determined that based on proceedings to date, it is currently unable to determine the probability of the outcome of this
matter or the range of reasonably possible loss, if any. The Company intends to defend this matter vigorously.
On March 9, 2011, Benyamin Kohanim filed a shareholder derivative action (the “Kohanim action”) on behalf
of the Company in the District Court against Sheldon G. Adelson, Jason N. Ader, Irwin Chafetz, Charles D. Forman,
George P. Koo, Michael A. Leven, Jeffrey H. Schwartz and Irwin A. Siegel, the members of the Board of Directors at
the time. The complaint alleges, among other things, breach of fiduciary duties in failing to properly implement, oversee
and maintain internal controls to ensure compliance with the FCPA. The complaint seeks to recover for the Company
unspecified damages, including restitution and disgorgement of profits, and also seeks to recover attorneys’ fees, costs
and related expenses for the plaintiff. On April 18, 2011, Ira J. Gaines, Sunshine Wire and Cable Defined Benefit
Pension Plan Trust dated 1/1/92 and Peachtree Mortgage Ltd. filed a shareholder derivative action (the “Gaines action”)
on behalf of the Company in the District Court against Sheldon G. Adelson, Jason N. Ader, Irwin Chafetz, Charles D.
Forman, George P. Koo, Michael A. Leven, Jeffrey H. Schwartz and Irwin A. Siegel, the members of the Board of
Directors at the time. The complaint raises substantially similar claims as alleged in the Kohanim action. The complaint
seeks to recover for the Company unspecified damages, and also seeks to recover attorneys’ fees, costs and related
expenses for the plaintiffs. The Kohanim and Gaines actions have been consolidated and are reported as one consolidated
matter. On July 25, 2011, the plaintiffs filed a first verified amended consolidated complaint. The plaintiffs have twice
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agreed to stay the proceedings. A 120-day stay was entered by the District Court in October 2011. It was extended for
another 90 days in February 2012 and expired in May 2012. The parties agreed to an extension of the May 2012 deadline
that expired on October 30, 2012. The defendants filed a motion to dismiss on November 1, 2012, based on the fact
that the plaintiffs have suffered no damages. On January 23, 2013, the District Court denied the motion to dismiss in
part, deferred the remainder of the motion to dismiss and stayed the proceedings until a July 22, 2013, status hearing.
On July 22, 2013, the District Court extended the stay until December 2, 2013, and then on December 2, 2013, extended
it again until March 3, 2014. On March 3, 2014, the judge extended the stay until a status hearing set for September 4,
2014, when the judge extended the stay until the next status hearing set for March 5, 2015. This consolidated action is
in a preliminary stage and management has determined that based on proceedings to date, it is currently unable to
determine the probability of the outcome of this matter or the range of reasonably possible loss, if any. The Company
intends to defend this matter vigorously.
On April 1, 2011, Nasser Moradi, Richard Buckman, Douglas Tomlinson and Matt Abbeduto filed a shareholder
derivative action (the “Moradi action”), as amended on April 15, 2011, on behalf of the Company in the U.S. District
Court, against Sheldon G. Adelson, Jason N. Ader, Irwin Chafetz, Charles D. Forman, George P. Koo, Michael A.
Leven, Jeffrey H. Schwartz and Irwin A. Siegel, the members of the Board of Directors at the time. The complaint
raises substantially similar claims as alleged in the Kohanim and Gaines actions. The complaint seeks to recover for
the Company unspecified damages, including exemplary damages and restitution, and also seeks to recover attorneys’
fees, costs and related expenses for the plaintiffs. On April 18, 2011, the Louisiana Municipal Police Employees
Retirement System filed a shareholder derivative action (the “LAMPERS action”) on behalf of the Company in the
U.S. District Court, against Sheldon G. Adelson, Jason N. Ader, Irwin Chafetz, Charles D. Forman, George P. Koo,
Michael A. Leven, Jeffrey H. Schwartz and Irwin A. Siegel, the members of the Board of Directors at the time, and
Wing T. Chao, a former member of the Board of Directors. The complaint raises substantially similar claims as alleged
in the Kohanim, Moradi and Gaines actions. The complaint seeks to recover for the Company unspecified damages,
and also seeks to recover attorneys’ fees, costs and related expenses for the plaintiff. On April 22, 2011, John Zaremba
filed a shareholder derivative action (the “Zaremba action”) on behalf of the Company in the U.S. District Court, against
Sheldon G. Adelson, Jason N. Ader, Irwin Chafetz, Charles D. Forman, George P. Koo, Michael A. Leven, Jeffrey H.
Schwartz and Irwin A. Siegel, the members of the Board of Directors at the time, and Wing T. Chao, a former member
of the Board of Directors. The complaint raises substantially similar claims as alleged in the Kohanim, Moradi, Gaines
and LAMPERS actions. The complaint seeks to recover for the Company unspecified damages, including restitution,
disgorgement of profits and injunctive relief, and also seeks to recover attorneys’ fees, costs and related expenses for
the plaintiff. On August 25, 2011, the U.S. District Court consolidated the Moradi, LAMPERS and Zaremba actions
and such actions are reported as one consolidated matter. On November 17, 2011, the defendants filed a motion to
dismiss or alternatively to stay the federal action due to the parallel state court action described above. On May 25,
2012, the case was transferred to a new judge. On August 27, 2012, the U.S. District Court granted the motion to stay
pending a further update of the Special Litigation Committee due on October 30, 2012. On October 30, 2012, the
defendants filed the update asking the judge to determine whether to continue the stay until January 31, 2013, or to
address motions to dismiss. On November 7, 2012, the U.S. District Court denied defendants request for an extension
of the stay but asked the parties to brief the motion to dismiss. On November 21, 2012, defendants filed their motion
to dismiss. On December 21, 2012, plaintiffs filed their opposition and on January 18, 2013, defendants filed their
reply. On May 31, 2013, the case was reassigned to a new judge. On April 11, 2014, the judge denied the motion to
dismiss without prejudice and ordered the case stayed pending the outcome of the state court action in Kohanim described
above. The judge also ordered the parties to file a joint status report with the U.S. District Court by September 10,
2014, which was filed. This consolidated action is in a preliminary stage and management has determined that based
on proceedings to date, it is currently unable to determine the probability of the outcome of this matter or the range of
reasonably possible loss, if any. The Company intends to defend this matter vigorously.
On January 23, 2014, W.A. Sokolowski filed a shareholder derivative action (the "Sokolowski action") purporting
to act on behalf of the Company and in his individual capacity as a shareholder in the U.S. District Court for the District
of Nevada against Sheldon G. Adelson, Michael A. Leven, Jason N. Ader, Irwin Chafetz, Charles D. Forman, George
P. Koo, Charles A. Koppelman, Jeffrey H. Schwartz, Victor Chaltiel and Irwin A. Siegel, each of whom was serving
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on the Board of Directors (collectively, the “Directors”), as well as against Frederick Hipwell, a partner at
PricewaterhouseCoopers LLP (“PwC”), the Company’s former auditor. The complaint alleges, among other things,
that the Directors breached their fiduciary duties to the Company by attempting to conceal certain alleged
misrepresentations and wrongdoing by the Company’s management, concealed certain facts in connection with audits
performed by PwC and caused the issuance of a false or misleading proxy statement in 2013. The complaint seeks,
among other things the appointment of a conservator or special master to oversee the Company’s discussions with
governmental agencies as well as to recover for the Company unspecified damages, including restitution and
disgorgement of profits, and also seeks to recover attorneys’ fees, costs and related expenses for the plaintiff. The
Company filed a motion to dismiss the complaint on February 13, 2014. On February 28, 2014, defendant Hipwell
filed his motion to dismiss the complaint. On March 12, 2014, the plaintiff filed its response to the Company’s motion
to dismiss and on March 26, 2014, the Company filed its reply. On March 31, 2014, the plaintiff filed its response to
Hipwell’s motion to dismiss and on April 10, 2014, Hipwell filed his reply. On April 1, 2014, the plaintiff filed a renewed
motion for expedited discovery (the first motion was filed on January 24, 2014 and was denied by the judge). The
Company filed its response on April 18, 2014. On May 2, 2014, the U.S. District Court denied this second motion. On
May 9, 2014, Directors Ader, Chafetz, Chaltiel, Forman, Koppelman and Leven filed their motion to dismiss. On June
10, 2014, the plaintiff filed its opposition to these Directors motion to dismiss. On June 30, 2014, these Directors filed
their reply. On July 30, 2014, the U.S. District Court granted the Company’s motion to dismiss the complaint, finding
plaintiff had failed to allege stock ownership facts demonstrating standing to sue, with leave for plaintiff to amend his
complaint to demonstrate stock ownership with more particularity. On August 29, 2014, the plaintiff filed an amended
complaint and, on September 15, 2014, the served defendants filed their motions to dismiss the amended complaint.
The plaintiff's opposition to the Company's motion to dismiss was filed on October 22, 2014, and to the individuals'
motions to dismiss on October 29, 2014. Plaintiffs also filed an opposition to Hipwell's motion on November 3, 2014,
and opposed Mr. Adelson's joinder on December 9, 2014. The served defendants' reply briefs were filed on November
24, 25 and 26, 2014. This action is in a preliminary stage and management has determined that based on proceedings
to date, it is currently unable to determine the probability of the outcome of this matter or the range of reasonably
possible loss, if any. The Company intends to defend this matter vigorously.
On March 6, 2014, the Board of Directors of the Company received a shareholder demand letter from a purported
shareholder named the John F. Scarpa Foundation ("Scarpa"). This letter recites substantially the same allegations as
the complaint filed in the Sokolowski action and demands that the same claims be asserted by the Company, which
was delivered to the Company by the same counsel representing Mr. Sokolowski. The Company responded, through
its counsel, on March 26, 2014. Scarpa then sent a revised demand letter to the Board of Directors on March 31, 2014.
The Company responded, through its counsel, on April 8, 2014. Scarpa then sent an additional demand letter dated
August 14, 2014 to which the Company responded on August 22, 2014. This matter is in a preliminary stage and
management has determined that based on proceedings to date, it is currently unable to determine the probability of
the outcome of this matter, whether this matter will result in litigation or the range of reasonably possible loss, if any.
The Company intends to defend this matter vigorously.
On January 19, 2012, Asian American Entertainment Corporation, Limited (“AAEC”) filed a claim (the “Macao
action”) with the Macao Judicial Court (Tribunal Judicial de Base) against VML, LVS (Nevada) International Holdings,
Inc. (“LVS (Nevada)”), Las Vegas Sands, LLC (“LVSLLC”) and VCR (collectively, the “Defendants”). The claim is
for 3.0 billion patacas (approximately $375.4 million at exchange rates in effect on December 31, 2014) as compensation
for damages resulting from the alleged breach of agreements entered into between AAEC and the Defendants for their
joint presentation of a bid in response to the public tender held by the Macao government for the award of gaming
concessions at the end of 2001. On July 4, 2012, the Defendants filed their defense to the Macao action with the Macao
Judicial Court. AAEC then filed a reply that included several amendments to the original claim, although the amount
of the claim was not amended. On January 4, 2013, the Defendants filed an amended defense to the amended claim
with the Macao Judicial Court. On September 23, 2013, the three U.S. Defendants filed a motion with the Macao Second
Instance Court, seeking recognition and enforcement of the U.S. Court of Appeals ruling in the Prior Action, referred
to below, given on April 10, 2009, which partially dismissed AAEC’s claims against the three U.S. Defendants. On
April 24, 2014, the Macao Judicial Court issued a Decision (Despacho Seneador) holding that AAEC’s claim against
115
LAS VEGAS SANDS CORP. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (CONTINUED)
VML is unfounded and that VML be removed as a party to the proceedings, and that the claim should proceed exclusively
against the three U.S. Defendants. The Macao Judicial Court further held that the existence of the pending application
for recognition and enforcement of the U.S. Court of Appeals ruling before the Macao Second Instance Court did not
justify a stay of the proceedings against the three U.S. Defendants at the present time, although in principle an application
for a stay of the proceedings against the three U.S. Defendants could be reviewed after the Macao Second Instance
Court had issued its decision. On June 25, 2014, the Macao Second Instance Court delivered a decision, which gave
formal recognition to and allowed enforcement in Macao of the judgment of the U.S. Court of Appeals, dismissing
AAEC's claims against the U.S. Defendants. Subject to an appeal by AAEC, the U.S. Defendants intend to apply to
the Macao First Instance Court to dismiss AAEC's claims in full. On July 9, 2014, the plaintiff filed yet another action
in the U.S. District Court against LVSC, LVSLLC, VCR, Sheldon G. Adelson, William P. Weidner, David Friedman
and Does 1-50 for declaratory judgment, equitable accounting, misappropriation of trade secrets, breach of confidence
and conversion based on a theory of copyright law. The claim was for $5.0 billion. On November 4, 2014, plaintiff
finally effected notice on the LVSC entities which was followed by a motion to dismiss by the U.S. Defendants on
November 10, 2014. Plaintiff failed to timely respond and on December 2, 2014, the U.S. Defendants moved for
immediate dismissal and sanctions against plaintiff and his counsel for the bringing of frivolous lawsuit. On December
19, 2014, plaintiff filed an incomplete and untimely response which was followed by plaintiff's December 27, 2014
notice of withdrawal of the lawsuit and the U.S. Defendants' December 29, 2014, reply in favor of sanctions and
dismissal with prejudice. The judge dismissed the U.S. action and the Defendants' sanctions motion remains pending.
The Macao action is in a preliminary stage and management has determined that based on proceedings to date, it is
currently unable to determine the probability of the outcome of the Macao matter or the range of reasonably possible
loss, if any. The Company intends to defend the Macao matter vigorously.
As previously disclosed by the Company, on February 5, 2007, AAEC brought a similar claim (the “Prior Action”)
in the U.S. District Court, against LVSI (now known as LVSLLC), VCR and Venetian Venture Development, LLC,
which are subsidiaries of the Company, and William P. Weidner and David Friedman, who are former executives of
the Company. The U.S. District Court entered an order on April 16, 2010, dismissing the Prior Action. On April 20,
2012, LVSLLC, VCR and LVS (Nevada) filed an injunctive action (the “Nevada Action”) against AAEC in the U.S.
District Court seeking to enjoin AAEC from proceeding with the Macao Action based on AAEC’s filing, and the U.S.
District Court’s dismissal, of the Prior Action. On June 14, 2012, the U.S. District Court issued an order that denied
the motions requesting the Nevada Action, thereby effectively dismissing the Nevada Action.
The Company previously received subpoenas from the U.S. Attorney’s Office for the Central District of California
(the “USAO”) requesting the production of documents relating to two prior customers of the Company’s properties. In
August 2013, the USAO completed its investigation and entered into an agreement with the Company, whereby the
Company agreed to voluntarily return $47.4 million to the U.S. Treasury, which represented funds received from or on
behalf of one of its customers, and provide written reports to the USAO regarding certain of its casino-related activities.
The amount was paid during the year ended December 31, 2013, and the matter has been closed.
On February 11, 2014, the Company disclosed that it was the victim of a sophisticated cyber-attack on its computer
networks in the United States. As a result of this criminal attack, the U.S. government has commenced investigations
into the source of the attack. In addition, the Company is working with internal and external forensic information
technology systems experts in connection with this effort. As a result of the investigations and the Company’s efforts,
which are ongoing, the Company has learned that certain customer and employee data was compromised at its Bethlehem
facility and other data may have been stolen in the attack as well as that the attack may have destroyed certain other
Company data. The Company is cooperating fully with the investigations. Based on the preliminary status of the
investigations and the absence of claims asserted thus far, management is currently unable to determine the probability
of the outcome of any matters relating to the cyber-attack, the extent of materiality or the range of reasonably possible
loss, if any.
116
LAS VEGAS SANDS CORP. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (CONTINUED)
Macao Concession and Subconcession
On June 26, 2002, the Macao government granted a concession to operate casinos in Macao through June 26,
2022, subject to certain qualifications, to Galaxy Casino Company Limited (“Galaxy”), a consortium of Macao and
Hong Kong-based investors. During December 2002, VML and Galaxy entered into a subconcession agreement that
was recognized and approved by the Macao government and allows VML to develop and operate casino projects,
including The Venetian Macao, Sands Cotai Central, the Plaza Casino at the Four Seasons Macao, Sands Macao and
The Parisian Macao, once opened, separately from Galaxy. Beginning on December 26, 2017, the Macao government
may redeem the subconcession agreement by providing the Company at least one year prior notice.
Under the subconcession, the Company is obligated to pay to the Macao government an annual premium with a
fixed portion and a variable portion based on the number and type of gaming tables it employs and gaming machines
it operates. The fixed portion of the premium is equal to 30.0 million patacas (approximately $3.8 million at exchange
rates in effect on December 31, 2014). The variable portion is equal to 300,000 patacas per gaming table reserved
exclusively for certain kinds of games or players, 150,000 patacas per gaming table not so reserved and 1,000 patacas
per electrical or mechanical gaming machine, including slot machines (approximately $37,542, $18,771 and $125,
respectively, at exchange rates in effect on December 31, 2014), subject to a minimum of 45.0 million patacas
(approximately $5.6 million at exchange rates in effect on December 31, 2014). The Company is also obligated to pay
a special gaming tax of 35% of gross gaming revenues and applicable withholding taxes. The Company must also
contribute 4% of its gross gaming revenue to utilities designated by the Macao government, a portion of which must
be used for promotion of tourism in Macao. Based on the number and types of gaming tables employed and gaming
machines in operation as of December 31, 2014, the Company was obligated under its subconcession to make minimum
future payments of approximately $42.7 million in each of the next five years and approximately $106.7 million
thereafter. These amounts are expected to increase as the Company completes its remaining Cotai Strip developments.
Currently, the gaming tax in Macao is calculated as a percentage of gross gaming revenue; however, unlike
Nevada, gross gaming revenue does not include deductions for credit losses. As a result, if the Company extends credit
to its customers in Macao and is unable to collect on the related receivables, the Company must pay taxes on its winnings
from these customers even though it was unable to collect on the related receivables. If the laws are not changed, the
Company’s business in Macao may not be able to realize the full benefits of extending credit to its customers.
Operating Leases
The Company leases real estate and various equipment under operating lease arrangements and is also party to
several service agreements with terms in excess of one year. As of December 31, 2014, the Company was obligated
under non-cancelable operating leases to make future minimum lease payments as follows (in thousands):
2015 ...................................................................................................................................................... $
2016 ......................................................................................................................................................
2017 ......................................................................................................................................................
2018 ......................................................................................................................................................
2019 ......................................................................................................................................................
Thereafter..............................................................................................................................................
Total minimum payments ..................................................................................................................... $
15,060
8,709
5,783
4,686
1,200
101,100
136,538
Expenses incurred under operating lease agreements, including those that are short-term and variable-rate in
nature, totaled $67.4 million, $67.5 million and $51.4 million for the years ended December 31, 2014, 2013 and 2012,
respectively.
117
LAS VEGAS SANDS CORP. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (CONTINUED)
Other Ventures and Commitments
The Company has entered into employment agreements with three of its executive officers, with remaining terms
of one to five years. As of December 31, 2014, the Company was obligated to make future payments of $5.5 million
during the year ending December 31, 2015, and $3.3 million during each of the next four years ending December 31,
2019.
During 2003, the Company entered into three lease termination and asset purchase agreements with The Grand
Canal Shoppes tenants. In each case, the Company has obtained title to leasehold improvements and other fixed assets,
which were originally purchased by The Grand Canal Shoppes tenants, and which have been recorded at estimated fair
market value, which approximated the discounted present value of the Company’s obligation to the former tenants. As
of December 31, 2014, the Company was obligated under two of these agreements still in effect to make future payments
of approximately $0.4 million in each of the next five years and $4.4 million thereafter.
Malls and Other
The Company leases space at several of its integrated resorts to various third parties. These leases are non-
cancelable operating leases with lease periods that vary from 1 month to 25 years. The leases include minimum base
rents with escalated contingent rent clauses. As of December 31, 2014, the future minimum rentals on these non-
cancelable leases are as follows (in thousands, at exchange rates in effect on December 31, 2014):
2015 ...................................................................................................................................................... $
2016 ......................................................................................................................................................
2017 ......................................................................................................................................................
2018 ......................................................................................................................................................
2019 ......................................................................................................................................................
Thereafter..............................................................................................................................................
Total minimum future rentals ............................................................................................................... $
407,294
358,692
289,366
216,504
171,566
314,479
1,757,901
The total minimum future rentals do not include the escalated contingent rent clauses. Contingent rentals amounted
to $103.9 million, $129.1 million and $109.0 million for the years ended December 31, 2014, 2013 and 2012,
respectively.
Note 14 — Stock-Based Employee Compensation
The Company has two nonqualified stock option plans, the 2004 Plan and the SCL Equity Plan, which are
described below. The plans provide for the granting of stock options pursuant to the applicable provisions of the Internal
Revenue Code and regulations.
Las Vegas Sands Corp. 2004 Equity Award Plan
The Company adopted the 2004 Plan for grants of options to purchase its common stock. The purpose of the
2004 Plan is to give the Company a competitive edge in attracting, retaining and motivating employees, directors and
consultants and to provide the Company with a stock plan providing incentives directly related to increases in its
stockholder value. Any of the Company’s subsidiaries’ or affiliates’ employees, directors or officers and many of its
consultants are eligible for awards under the 2004 Plan. The 2004 Plan provides for an aggregate of 26,344,000 shares
of the Company’s common stock to be available for awards. The 2004 Plan originally had a term of ten years, but in
June 2014, the Company's Board of Directors approved an amendment to the 2004 Plan, extending the term to December
2019. The compensation committee may grant awards of nonqualified stock options, incentive (qualified) stock options,
stock appreciation rights, restricted stock awards, restricted stock units, stock bonus awards, performance compensation
awards or any combination of the foregoing. As of December 31, 2014, there were 4,578,311 shares available for grant
under the 2004 Plan.
118
LAS VEGAS SANDS CORP. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (CONTINUED)
Stock option awards are granted with an exercise price equal to the fair market value (as defined in the 2004
Plan) of the Company’s stock on the date of grant. The outstanding stock options generally vest over four years and
have ten-year contractual terms. Compensation cost for all stock option grants, which all have graded vesting, is net
of estimated forfeitures and is recognized on a straight-line basis over the awards’ respective requisite service periods.
The Company estimates the fair value of stock options using the Black-Scholes option-pricing model. Expected
volatilities are based on the Company’s historical volatility for a period equal to the expected life of the stock options.
The expected option life is based on the contractual term of the option as well as historical exercise and forfeiture
behavior. The risk-free interest rate for periods equal to the expected term of the stock option is based on the U.S.
Treasury yield curve in effect at the time of grant. The expected dividend yield is based on the estimate of annual
dividends expected to be paid at the time of the grant.
Sands China Ltd. Equity Award Plan
The Company’s subsidiary, SCL, adopted an equity award plan (the “SCL Equity Plan”) for grants of options to
purchase ordinary shares of SCL. The purpose of the SCL Equity Plan is to give SCL a competitive edge in attracting,
retaining and motivating employees, directors and consultants and to provide SCL with a stock plan providing incentives
directly related to increases in its stockholder value. Subject to certain criteria as defined in the SCL Equity Plan, SCL’s
subsidiaries’ or affiliates’ employees, directors or officers and many of its consultants are eligible for awards under the
SCL Equity Plan. The SCL Equity Plan provides for an aggregate of 804,786,508 shares of SCL’s common stock to be
available for awards. The SCL Equity Plan has a term of ten years and no further awards may be granted after the
expiration of the term. SCL’s compensation committee may grant awards of stock options, stock appreciation rights,
restricted stock awards, restricted stock units, stock bonus awards, performance compensation awards or any
combination of the foregoing. As of December 31, 2014, there were 758,729,151 shares available for grant under the
SCL Equity Plan.
Stock option awards are granted with an exercise price not less than (i) the closing price of SCL’s stock on the
date of grant or (ii) the average closing price of SCL’s stock for the five business days immediately preceding the date
of grant. The outstanding stock options generally vest over four years and have ten-year contractual terms. Compensation
cost for all stock option grants, which all have graded vesting, is net of estimated forfeitures and is recognized on a
straight-line basis over the awards’ respective requisite service periods. The Company estimates the fair value of stock
options using the Black-Scholes option-pricing model. Expected volatilities are based on a combination of SCL's
historical volatilities and the historical volatilities from a selection of companies from SCL’s peer group due to SCL’s
lack of historical information. The Company used the simplified method for estimating expected option life, as the
options qualify as “plain-vanilla” options. The risk-free interest rate for periods equal to the expected term of the stock
option is based on the Hong Kong Exchange Fund Note rate in effect at the time of grant. The expected dividend yield
is based on the estimate of annual dividends expected to be paid at the time of the grant.
119
LAS VEGAS SANDS CORP. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (CONTINUED)
Stock-Based Employee Compensation Activity
The fair value of each option grant was estimated on the grant date using the Black-Scholes option-pricing model
with the following weighted average assumptions:
LVSC 2004 Plan:
Weighted average volatility...........................................................
Expected term (in years)................................................................
Risk-free rate .................................................................................
Expected dividends........................................................................
SCL Equity Plan:
Weighted average volatility...........................................................
Expected term (in years)................................................................
Risk-free rate .................................................................................
Expected dividends........................................................................
Year Ended December 31,
2013
2012
2014
56.5%
6.0
1.7%
4.6%
65.1%
6.3
1.3%
3.0%
94.8%
5.5
1.3%
2.5%
67.7%
6.3
0.7%
3.1%
95.2%
5.5
1.1%
1.9%
70.0%
6.2
0.5%
4.0%
A summary of the stock option activity for the Company’s equity award plans for the year ended December 31,
2014, is presented below:
LVSC 2004 Plan:
Outstanding as of January 1, 2014 ................
Granted ..........................................................
Exercised .......................................................
Forfeited ........................................................
Outstanding as of December 31, 2014 ..........
Exercisable as of December 31, 2014 ...........
SCL Equity Plan:
Outstanding as of January 1, 2014 ................
Exercised .......................................................
Forfeited ........................................................
Outstanding as of February 14, 2014 ............
Outstanding as of February 15, 2014(1) .........
Granted ..........................................................
Exercised .......................................................
Forfeited ........................................................
Outstanding as of December 31, 2014 ..........
Exercisable as of December 31, 2014 ...........
__________
Shares
6,907,191
2,359,455
(1,955,108)
(347,369)
6,964,169
3,975,245
17,607,046
(112,875)
(244,700)
17,249,471
17,249,471
11,660,500
(4,394,825)
(1,265,450)
23,249,696
5,139,498
$
$
$
$
$
$
Weighted
Average
Exercise
Price
Weighted
Average
Remaining
Contractual
Life (Years)
Aggregate
Intrinsic
Value
49.18
56.74
23.00
65.95
58.25
59.89
3.49
2.07
7.02
3.45
3.35
7.43
2.36
4.83
5.50
2.90
5.88
3.21
$
$
51,865,574
44,022,494
8.28
6.67
$
$
17,316,424
10,692,221
(1) As a result of SCL declaring a special dividend on January 24, 2014, the exercise price of all SCL stock options
outstanding on February 14, 2014, was reduced by $0.10 per share. This adjustment was the result of an
antidilution provision in the SCL Equity Plan and did not result in any additional compensation expense.
120
LAS VEGAS SANDS CORP. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (CONTINUED)
A summary of the unvested restricted stock and stock units under the Company’s equity award plans for the year
ended December 31, 2014, is presented below:
Shares
Weighted Average
Grant Date
Fair Value
LVSC 2004 Plan:
Unvested restricted stock as of January 1, 2014 ...........................................
Granted..........................................................................................................
Vested............................................................................................................
Forfeited ........................................................................................................
Unvested restricted stock as of December 31, 2014 .....................................
Unvested restricted stock units as of January 1, 2014 ..................................
Granted..........................................................................................................
Vested............................................................................................................
Forfeited ........................................................................................................
Unvested restricted stock units as of December 31, 2014 ............................
SCL Equity Plan:
Unvested restricted stock units as of January 1, 2014 ..................................
Granted..........................................................................................................
Vested............................................................................................................
Forfeited ........................................................................................................
Unvested restricted stock units as of December 31, 2014 ............................
912,713
31,137
(426,370)
(8,675)
508,805
387,707
9,984
(29,541)
(209,000)
159,150
2,608,400
362,800
—
—
2,971,200
$
$
$
$
$
$
45.94
75.46
42.00
40.34
51.15
38.47
68.30
49.40
25.02
55.98
6.64
6.81
—
—
6.66
As of December 31, 2014, under the 2004 Plan there was $41.5 million of unrecognized compensation cost, net
of estimated forfeitures of 8.0% per year, related to unvested stock options and there was $15.8 million of unrecognized
compensation cost, net of estimated forfeitures of 8.0% per year, related to unvested restricted stock and stock units.
The stock option and restricted stock and stock unit costs are expected to be recognized over a weighted average period
of 4.6 years and 1.6 years, respectively.
As of December 31, 2014, under the SCL Equity Plan there was $32.6 million of unrecognized compensation
cost, net of estimated forfeitures of 8.8% per year, related to unvested stock options and there was $13.5 million of
unrecognized compensation cost related to unvested restricted stock units. The stock option and restricted stock unit
costs are expected to be recognized over a weighted average period of 2.7 years and 2.5 years, respectively.
121
LAS VEGAS SANDS CORP. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (CONTINUED)
The stock-based compensation activity for the 2004 Plan and SCL Equity Plan is as follows for the three years
ended December 31, 2014 (in thousands, except weighted average grant date fair values):
Compensation expense:
Stock options .......................................................................... $
Restricted stock and stock units .............................................
$
Income tax benefit recognized in the consolidated statements of
operations .................................................................................... $
Compensation cost capitalized as part of property and
equipment .................................................................................... $
LVSC 2004 Plan:
Stock options granted ....................................................................
Weighted average grant date fair value ......................................... $
Restricted stock granted ................................................................
Weighted average grant date fair value ......................................... $
Restricted stock units granted........................................................
Weighted average grant date fair value ......................................... $
Stock options exercised:
Intrinsic value ......................................................................... $
Cash received ......................................................................... $
Tax benefit realized for tax deductions from stock-based
compensation........................................................................ $
SCL Equity Plan:
Stock options granted ....................................................................
Weighted average grant date fair value ......................................... $
Restricted stock units granted........................................................
Weighted average grant date fair value ......................................... $
Stock options exercised:
Intrinsic value ......................................................................... $
Cash received ......................................................................... $
Tax benefit realized for tax deductions from stock-based
compensation........................................................................ $
Year Ended December 31,
2013
2012
2014
24,964
23,094
48,058
6,743
1,437
2,359
20.25
31
75.46
10
68.30
105,386
44,973
$
$
$
$
$
$
$
$
$
32,549
20,828
53,377
$
$
— $
941
$
288
35.76
47
54.72
123
58.82
129,149
50,223
$
$
$
$
$
35,777
29,651
65,428
—
938
537
36.17
517
52.97
333
25.98
84,761
34,668
— $
— $
—
11,661
3.40
363
6.81
19,282
10,677
$
$
$
$
4,537
2.63
2,608
6.64
25,786
19,373
$
$
$
$
7,762
1.65
—
—
12,261
11,572
— $
— $
—
Note 15 — Employee Benefit Plans
The Company is self-insured for health care and workers compensation benefits for its U.S. employees. The
liability for claims filed and estimates of claims incurred but not filed is included in other accrued liabilities in the
accompanying consolidated balance sheets.
Participation in the VCR 401(k) employee savings plan is available for all eligible employees after a three-month
probation period. 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. The Company matches 150% of the first $390 of employee contributions
and 50% of employee contributions in excess of $390 up to a maximum of 5% of participating employee’s eligible
gross wages. For the years ended December 31, 2014, 2013 and 2012, the Company’s matching contributions under
the savings plan were $8.7 million, $8.2 million and $4.7 million, respectively.
Participation in VML’s provident retirement fund is available for all permanent employees after a three-month
probation period. VML contributes 5% of each employee’s basic salary to the fund and the employee is eligible to
receive, upon resignation, 30% of these contributions after working for three consecutive years, gradually increasing
122
LAS VEGAS SANDS CORP. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (CONTINUED)
to 100% after working for ten years. For the years ended December 31, 2014, 2013 and 2012, VML’s contributions
into the provident fund were $31.4 million, $28.6 million and $22.9 million, respectively.
Participation in MBS’s provident retirement fund is available for all permanent employees that are Singapore
residents upon joining the Company. As of December 31, 2014, MBS contributes 16% of each employee’s basic salary
to the fund, subject to certain caps as mandated by local regulations. The employee is eligible to receive funds upon
reaching the retirement age or upon meeting requirements set up by local regulations. For the years ended December 31,
2014, 2013 and 2012, MBS’s contributions into the provident fund were $44.9 million, $40.4 million and $32.8 million,
respectively.
Note 16 — Related Party Transactions
During the years ended December 31, 2014, 2013 and 2012, the Principal Stockholder and his family purchased
certain lodging, banquet room, catering goods and services and procurement services from the Company for
approximately $1.2 million, $1.7 million and $1.3 million, respectively.
During the years ended December 31, 2014, 2013 and 2012, the Company incurred and paid certain expenses
totaling $5.7 million, $11.4 million and $11.7 million, respectively, to its Principal Stockholder related to the Company’s
use of his personal aircraft for business purposes. In addition, during the years ended December 31, 2014, 2013 and
2012, the Company charged and received from the Principal Stockholder $18.3 million, $17.6 million and $15.4 million,
respectively, related to aviation costs incurred by the Company for the Principal Stockholder’s use of Company aviation
personnel and assets for personal purposes. See “— Note 9 — Equity — Other Equity Transactions” regarding the
Company’s purchase of a Boeing 747 airplane from an entity controlled by the Principal Stockholder in June 2012.
During the years ended December 31, 2014 and 2013, the Company charged and received from one of its executive
officers $0.3 million and $0.1 million, respectively, related to aviation costs incurred by the Company for the executive’s
use of Company aviation personnel and assets for personal purposes.
On March 2, 2012, the Principal Stockholder’s family exercised all of their outstanding Warrants to purchase
87,500,175 shares of the Company’s common stock for $6.00 per share and paid $525.0 million in cash as settlement
of the Warrant exercise price. See “— Note 9 — Equity — Preferred Stock and Warrants — Preferred Stock Issued to
Principal Stockholder’s Family.”
During the year ended December 31, 2003, the Company purchased the lease interest and assets of Carnevale
Coffee Bar, LLC, in which the Principal Stockholder is a partner, for $3.1 million, payable in installments of $0.6
million during 2003, and approximately $0.3 million annually over 10 years, beginning in 2004 through September 1,
2013.
Note 17 — Segment Information
The Company’s principal operating and developmental activities occur in three geographic areas: Macao,
Singapore and the U.S. The Company reviews the results of operations for each of its operating segments: The Venetian
Macao; Sands Cotai Central; Four Seasons Macao; Sands Macao; Other Asia (comprised primarily of the Company’s
ferry operations and various other operations that are ancillary to the Company’s properties in Macao); Marina Bay
Sands; The Venetian Las Vegas, which includes the Sands Expo Center; The Palazzo; and Sands Bethlehem. The
Venetian Las Vegas and The Palazzo operating segments are managed as a single integrated resort and have been
aggregated as one reportable segment (the “Las Vegas Operating Properties”), considering their similar economic
characteristics, types of customers, types of services and products, the regulatory business environment of the operations
within each segment and the Company’s organizational and management reporting structure. The Company also reviews
construction and development activities for each of its primary projects under development, in addition to its reportable
segments noted above. The Company’s primary projects under development are The Parisian Macao, the St. Regis
tower (the remaining phase of Sands Cotai Central) and the Four Seasons Apartments in Macao, and the Las Vegas
Condo Tower (which construction currently is suspended and is included in Corporate and Other) in the U.S. The
123
LAS VEGAS SANDS CORP. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (CONTINUED)
corporate activities of the Company are also included in Corporate and Other. The Company’s segment information is
as follows as of and for the years ended December 31, 2014, 2013 and 2012 (in thousands):
Year Ended December 31,
2013
2012
2014
Net Revenues
Macao:
The Venetian Macao............................................................... $
Sands Cotai Central ................................................................
Four Seasons Macao...............................................................
Sands Macao ..........................................................................
Other Asia...............................................................................
Marina Bay Sands..........................................................................
United States:
$
4,040,681
3,133,864
1,107,779
1,174,795
151,778
9,608,897
3,214,210
$
3,851,230
2,698,430
1,065,405
1,237,016
139,572
8,991,653
2,968,366
3,037,975
1,052,124
1,086,456
1,250,552
148,330
6,575,437
2,886,139
Las Vegas Operating Properties .............................................
Sands Bethlehem ....................................................................
1,478,769
504,237
1,983,006
Intersegment eliminations .............................................................
(222,264)
Total net revenues.......................................................................... $ 14,583,849
1,518,024
496,738
2,014,762
(204,896)
$ 13,769,885
1,384,629
470,458
1,855,087
(185,531)
$ 11,131,132
Year Ended December 31,
2013
2012
2014
Intersegment Revenues
Macao:
The Venetian Macao............................................................... $
Sands Cotai Central ................................................................
Other Asia...............................................................................
Marina Bay Sands..........................................................................
Las Vegas Operating Properties.....................................................
Total intersegment revenues.......................................................... $
5,591
301
42,330
48,222
12,209
161,833
222,264
$
$
5,296
356
34,120
39,772
9,548
155,576
204,896
$
$
5,125
251
32,748
38,124
3,449
143,958
185,531
124
LAS VEGAS SANDS CORP. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (CONTINUED)
Adjusted Property EBITDA(1)
Macao:
The Venetian Macao............................................................... $
Sands Cotai Central ................................................................
Four Seasons Macao...............................................................
Sands Macao ..........................................................................
Other Asia...............................................................................
Marina Bay Sands..........................................................................
United States:
Las Vegas Operating Properties .............................................
Sands Bethlehem ....................................................................
Total adjusted property EBITDA...................................................
Other Operating Costs and Expenses
Stock-based compensation ............................................................
Legal settlement.............................................................................
Corporate .......................................................................................
Pre-opening....................................................................................
Development..................................................................................
Depreciation and amortization ......................................................
Amortization of leasehold interests in land ...................................
Impairment loss .............................................................................
Loss on disposal of assets..............................................................
Operating income ..........................................................................
Other Non-Operating Costs and Expenses
Interest income ..............................................................................
Interest expense, net of amounts capitalized .................................
Other income .................................................................................
Loss on modification or early retirement of debt ..........................
Income tax expense .......................................................................
Net income..................................................................................... $
_________________________
Year Ended December 31,
2013
2012
2014
$
$
1,546,323
1,001,487
374,899
338,590
3,493
3,264,792
1,723,147
313,913
120,491
434,404
5,422,343
(28,769)
—
(174,750)
(26,230)
(14,325)
(1,031,589)
(40,598)
—
(6,856)
4,099,226
1,499,937
739,723
305,040
362,858
(3,855)
2,903,703
1,384,576
351,739
123,337
475,076
4,763,355
(30,053)
(47,400)
(189,535)
(13,339)
(15,809)
(1,007,468)
(40,352)
—
(11,156)
3,408,243
25,643
(274,181)
1,965
(19,942)
(244,640)
3,588,071
$
16,337
(271,211)
4,321
(14,178)
(188,836)
2,954,676
$
1,143,245
213,476
288,170
350,639
(15,950)
1,979,580
1,366,245
331,182
114,055
445,237
3,791,062
(30,772)
—
(207,030)
(143,795)
(19,958)
(892,046)
(40,165)
(143,674)
(2,240)
2,311,382
23,252
(258,564)
5,740
(19,234)
(180,763)
1,881,813
(1) Adjusted property EBITDA is net income before intersegment royalty fees, stock-based compensation expense,
legal settlement expense (see "— Note 13 — Commitments and Contingencies — Litigation"), corporate
expense, pre-opening expense, development expense, depreciation and amortization, amortization of leasehold
interests in land, impairment loss, loss on disposal of assets, interest, other income, loss on modification or
early retirement of debt and income taxes. Adjusted property EBITDA is used by management as the primary
measure of operating performance of the Company’s properties and to compare the operating performance of
the Company’s properties with that of its competitors.
125
LAS VEGAS SANDS CORP. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (CONTINUED)
Capital Expenditures
Corporate and Other ...................................................................... $
Macao:
The Venetian Macao...............................................................
Sands Cotai Central ................................................................
Four Seasons Macao...............................................................
Sands Macao ..........................................................................
Other Asia...............................................................................
The Parisian Macao ................................................................
Marina Bay Sands..........................................................................
United States:
Las Vegas Operating Properties .............................................
Sands Bethlehem ....................................................................
Total capital expenditures.............................................................. $
Total Assets
Corporate and Other ...................................................................... $
Macao:
The Venetian Macao...............................................................
Sands Cotai Central ................................................................
Four Seasons Macao...............................................................
Sands Macao ..........................................................................
Other Asia...............................................................................
The Parisian Macao ................................................................
Other Development Projects ..................................................
Marina Bay Sands..........................................................................
United States:
Year Ended December 31,
2013
2012
2014
32,030
$
41,152
$
100,887
125,293
345,748
41,440
40,402
2,617
390,582
946,082
79,612
108,666
12,266
120,932
1,178,656
$
96,172
262,540
15,003
26,491
1,319
212,842
614,367
142,706
93,191
6,695
99,886
898,111
$
112,351
862,951
28,143
25,076
1,193
20,393
1,050,107
119,647
156,205
22,388
178,593
1,449,234
2014
December 31,
2013
2012
613,683
$
630,673
$
586,788
3,900,921
4,761,907
1,157,502
414,689
304,463
805,220
91
11,344,793
6,106,397
4,367,533
4,669,358
1,273,654
383,444
328,332
376,014
169
11,398,504
6,354,231
3,254,193
4,791,560
1,338,714
414,531
345,522
118,975
123
10,263,618
6,941,510
Las Vegas Operating Properties .............................................
Sands Bethlehem ....................................................................
3,623,808
673,010
4,296,818
Total assets..................................................................................... $ 22,361,691
3,653,127
687,729
4,340,856
$ 22,724,264
3,605,513
766,223
4,371,736
$ 22,163,652
126
LAS VEGAS SANDS CORP. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (CONTINUED)
Total Long-Lived Assets
Corporate and Other ...................................................................... $
Macao:
The Venetian Macao...............................................................
Sands Cotai Central ................................................................
Four Seasons Macao...............................................................
Sands Macao ..........................................................................
Other Asia...............................................................................
The Parisian Macao ................................................................
Marina Bay Sands..........................................................................
United States:
2014
December 31,
2013
2012
357,071
$
388,448
$
398,100
1,893,032
3,814,699
932,034
286,640
177,335
804,328
7,908,068
4,874,263
1,925,040
3,772,095
928,396
279,395
189,136
376,014
7,470,076
5,277,126
1,968,415
3,836,471
971,732
285,344
202,392
118,912
7,383,266
5,657,351
Las Vegas Operating Properties .............................................
Sands Bethlehem ....................................................................
3,024,380
561,782
3,586,162
Total long-lived assets................................................................... $ 16,725,564
3,073,793
578,329
3,652,122
$ 16,787,772
3,179,426
607,346
3,786,772
$ 17,225,489
Note 18 — Condensed Consolidating Financial Information
LVSLLC, as the issuer and primary obligor of the 2013 U.S. Credit Facility, VCR, Venetian Marketing, Inc.,
Sands Expo & Convention Center, Inc. and Sands Pennsylvania, Inc. (collectively, the “Restricted Subsidiaries”), are
all guarantors under the 2013 U.S. Credit Facility. The noncontrolling interest amounts included in the Restricted
Subsidiaries’ condensed consolidating financial information are related to non-voting preferred stock of one of the
subsidiaries held by third parties.
In February 2008, all of the capital stock of Phase II Mall Subsidiary, LLC (a subsidiary of VCR), was sold to
GGP; however, the sale is not complete from an accounting perspective due to the Company’s continuing involvement
in the transaction related to the participation in certain potential future revenues earned by GGP. Certain of the assets,
liabilities and operating results related to the ownership and operation of the mall by Phase II Mall Subsidiary, LLC
subsequent to the sale will continue to be accounted for by the Restricted Subsidiaries, and therefore are included in
the “Restricted Subsidiaries” columns in the following condensed consolidating financial information. As a result, net
liabilities of $40.3 million (consisting of $268.8 million of liabilities consisting primarily of deferred proceeds from
the sale, partially offset by $228.5 million of property and equipment) and $29.3 million (consisting of $268.6 million
of liabilities consisting primarily of deferred proceeds from the sale, partially offset by $239.3 million of property and
equipment) as of December 31, 2014 and 2013, respectively, and a net loss (consisting primarily of depreciation expense)
of $11.8 million, $12.9 million and $15.1 million for the years ended December 31, 2014, 2013 and 2012, respectively,
related to the mall and are being accounted for by the Restricted Subsidiaries. These balances and amounts are not
collateral for the 2013 U.S. Credit Facility.
In connection with the refinancing of the prior U.S. senior secured credit facility in December 2013, there has
been a change in the group of subsidiaries that are the Restricted Subsidiaries, to exclude Palazzo Condo Tower, LLC,
LVS (Nevada) International Holdings, Inc. and LVS Management Services, LLC. Accordingly, the Company had
reclassified the 2012 financial information in the prior period to conform to the current presentation of the Restricted
Subsidiaries.
Additionally, LVSC is a holding company and, as a result, its ability to pay dividends is dependent on its
subsidiaries’ ability to provide funds to it. Restrictions imposed by the Company’s U.S., Macao and Singapore credit
facilities may restrict the Company’s key subsidiaries holding a majority of the consolidated group’s total assets from
making dividends or distributions, subject to certain exceptions as defined in the agreements, unless certain financial
and non-financial criteria have been satisfied. LVSC received cash dividends of $3.41 billion, $1.84 billion and $2.75
billion from its subsidiaries during the years ended December 31, 2014, 2013 and 2012, respectively.
127
LAS VEGAS SANDS CORP. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (CONTINUED)
The following condensed consolidating financial information of LVSC, a non-guarantor parent; the Restricted
Subsidiaries, including LVSLLC as the issuer; and the non-restricted subsidiaries on a combined basis as of
December 31, 2014 and 2013, and for each of the three years in the period ended December 31, 2014, is being presented
in order to meet the reporting requirements under the 2013 U.S. Credit Facility, and is not intended to comply with
SEC Regulation S-X 3-10 (in thousands):
CONDENSED CONSOLIDATING BALANCE SHEETS
December 31, 2014
LVSC
(Non-Guarantor
Parent)
Restricted
Subsidiaries
Non-Restricted
Subsidiaries
Cash and cash equivalents ......................... $
Restricted cash and cash equivalents .........
Intercompany receivables ..........................
Intercompany notes receivables.................
Accounts receivable, net ............................
Inventories..................................................
Deferred income taxes, net ........................
Prepaid expenses and other........................
Total current assets .............................
Property and equipment, net ......................
Investments in subsidiaries ........................
Deferred financing costs, net .....................
Intercompany receivables ..........................
Intercompany notes receivable ..................
Deferred income taxes, net ........................
Leasehold interests in land, net..................
Intangible assets, net ..................................
Other assets, net .........................................
Total assets................................................. $
Accounts payable ....................................... $
Construction payables................................
Intercompany payables ..............................
Intercompany notes payable ......................
Accrued interest payable............................
Other accrued liabilities .............................
Deferred income taxes ...............................
Income taxes payable.................................
Current maturities of long-term debt .........
Total current liabilities........................
Other long-term liabilities..........................
Intercompany payables ..............................
Intercompany notes payable ......................
Deferred income taxes ...............................
Deferred amounts related to mall
transactions ..............................................
Long-term debt...........................................
Total liabilities ...........................................
Total Las Vegas Sands Corp.
stockholders’ equity .................................
Noncontrolling interests.............................
Total equity ................................................
Total liabilities and equity.......................... $
114,125
—
431,754
—
15,144
5,238
6,803
26,210
599,274
130,155
7,010,357
123
226
—
—
—
690
714
7,741,539
8,065
156
—
370,836
76
31,050
—
—
3,688
413,871
3,014
—
—
51,085
—
59,983
527,953
Consolidating/
Eliminating
Entries
$
— $
—
(687,125)
(370,836)
—
—
(39,239)
(461)
(1,097,661)
—
— (12,875,205)
—
(38,989)
(1,250,544)
(96,243)
—
—
—
Total
3,506,319
6,566
—
—
1,510,772
41,674
—
125,168
5,190,499
15,372,474
—
205,596
—
—
31,720
1,353,090
86,260
122,052
$ (15,358,642) $ 22,361,691
112,721
— $
$
270,929
—
—
(687,125)
—
(370,836)
7,943
—
1,984,444
—
12,522
(39,239)
224,201
(461)
99,734
—
2,712,494
(1,097,661)
124,614
—
—
(38,989)
—
(1,250,544)
188,935
(96,243)
$
3,046,795
6,566
—
370,836
1,224,790
25,691
1,196
87,530
4,763,404
12,262,834
180,320
—
—
127,963
1,353,090
85,570
101,602
$ 18,874,783
79,167
$
266,772
256,529
—
6,837
1,719,613
51,761
224,662
71,822
2,677,163
112,345
38,989
1,250,544
188,935
$
345,399
—
255,371
—
270,838
10,745
31,240
11,889
925,482
2,979,485
5,864,848
25,153
38,763
1,250,544
—
—
—
19,736
$ 11,104,011
25,489
$
4,001
430,596
—
1,030
233,781
—
—
24,224
719,121
9,255
—
—
45,158
422,153
3,230,653
4,426,340
—
6,602,277
10,870,253
—
—
(2,483,437)
422,153
9,892,913
13,341,109
7,213,586
—
7,213,586
7,741,539
6,677,266
405
6,677,671
$ 11,104,011
6,197,939
1,806,591
8,004,530
$ 18,874,783
(12,875,205)
—
(12,875,205)
7,213,586
1,806,996
9,020,582
$ (15,358,642) $ 22,361,691
128
LAS VEGAS SANDS CORP. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (CONTINUED)
CONDENSED CONSOLIDATING BALANCE SHEETS
December 31, 2013
LVSC
(Non-Guarantor
parent)
Restricted
Subsidiaries
Non-Restricted
Subsidiaries
Cash and cash equivalents ......................... $
Restricted cash and cash equivalents .........
Intercompany receivables ..........................
Intercompany notes receivable ..................
Accounts receivable, net ............................
Inventories..................................................
Deferred income taxes, net ........................
Prepaid expenses and other........................
Total current assets .............................
Property and equipment, net ......................
Investments in subsidiaries ........................
Deferred financing costs, net .....................
Intercompany receivables ..........................
Intercompany notes receivable ..................
Deferred income taxes, net ........................
Leasehold interests in land, net..................
Intangible assets, net ..................................
Other assets, net .........................................
Total assets................................................. $
Accounts payable ....................................... $
Construction payables................................
Intercompany payables ..............................
Intercompany notes payable ......................
Accrued interest payable............................
Other accrued liabilities .............................
Deferred income taxes ...............................
Income taxes payable.................................
Current maturities of long-term debt .........
Total current liabilities........................
Other long-term liabilities..........................
Intercompany payables ..............................
Intercompany notes payable ......................
Deferred income taxes ...............................
Deferred amounts related to mall
transactions ..............................................
Long-term debt...........................................
Total liabilities ...........................................
Total Las Vegas Sands Corp.
stockholders’ equity .................................
Noncontrolling interests.............................
Total equity ................................................
Total liabilities and equity.......................... $
50,180
—
271,993
—
11,815
3,895
7,509
21,311
366,703
155,806
7,568,252
181
483
—
—
—
690
264
8,092,379
8,381
2,161
—
251,537
77
54,071
—
—
3,688
319,915
3,775
—
—
39,523
—
63,672
426,885
Consolidating/
Eliminating
Entries
$
— $
—
(508,252)
(251,537)
—
—
(44,742)
—
(804,531)
—
— (13,680,759)
—
(39,414)
(1,081,710)
13,821
—
—
—
Total
3,600,414
6,839
—
—
1,762,110
41,946
—
104,230
5,515,539
15,358,953
—
185,964
—
—
13,821
1,428,819
102,081
119,087
$ (15,592,593) $ 22,724,264
119,194
— $
$
241,560
—
—
(508,252)
—
(251,537)
6,551
—
2,194,866
—
13,309
(44,742)
176,678
—
377,507
—
3,129,665
(804,531)
112,195
—
—
(39,414)
—
(1,081,710)
173,211
13,821
$
3,234,745
6,839
—
251,537
1,454,962
25,442
—
71,327
5,044,852
12,146,469
155,046
—
—
—
1,428,819
101,391
96,535
$ 18,973,112
85,134
$
236,173
229,943
—
6,250
1,916,036
58,051
176,661
348,927
3,057,175
98,245
39,414
1,081,710
65,199
$
315,489
—
236,259
—
295,333
12,609
37,233
11,592
908,515
3,056,678
6,112,507
30,737
38,931
1,081,710
—
—
—
22,288
$ 11,251,366
25,679
$
3,226
278,309
—
224
224,759
—
17
24,892
557,106
10,175
—
—
54,668
425,912
2,823,269
3,871,130
—
6,495,811
10,837,554
—
—
(1,911,834)
425,912
9,382,752
13,223,735
7,665,494
—
7,665,494
8,092,379
7,379,831
405
7,380,236
$ 11,251,366
6,300,928
1,834,630
8,135,558
$ 18,973,112
(13,680,759)
—
(13,680,759)
7,665,494
1,835,035
9,500,529
$ (15,592,593) $ 22,724,264
129
LAS VEGAS SANDS CORP. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (CONTINUED)
CONDENSED CONSOLIDATING STATEMENTS OF OPERATIONS
For the Year Ended December 31, 2014
LVSC
(Non-Guarantor
parent)
Restricted
Subsidiaries
Non-Restricted
Subsidiaries
Consolidating/
Eliminating
Entries
Total
Revenues:
Casino ................................................. $
Rooms .................................................
Food and beverage..............................
Mall.....................................................
Convention, retail and other ...............
Less — promotional allowances................
Net revenues .......................................
Operating expenses:
Casino .................................................
Rooms .................................................
Food and beverage..............................
Mall.....................................................
Convention, retail and other ...............
Provision for doubtful accounts..........
General and administrative .................
Corporate ............................................
Pre-opening.........................................
Development.......................................
Depreciation and amortization............
Amortization of leasehold interests
in land ...............................................
(Gain) loss on disposal of assets.........
Operating income (loss).............................
Other income (expense):
Interest income....................................
Interest expense, net of amounts
capitalized .........................................
Other income (expense)......................
Loss on modification or early
retirement of debt..............................
Income from equity investments
in subsidiaries ...................................
Income before income taxes ......................
Income tax benefit (expense) .....................
Net income .................................................
Net income attributable to noncontrolling
interests ....................................................
Net income attributable to Las Vegas
Sands Corp. .............................................. $
— $
—
—
—
—
—
(1,279)
(1,279)
$
509,206
491,493
201,892
—
320,409
1,523,000
(88,929)
1,434,071
$ 11,495,155
1,048,927
576,877
553,534
410,967
14,085,460
(749,504)
13,335,956
— $ 12,004,361
1,540,420
—
778,769
—
553,534
—
548,704
(182,672)
15,425,788
(182,672)
(841,939)
(2,227)
14,583,849
(184,899)
—
—
—
—
—
—
—
156,775
—
14,210
26,020
298,641
139,837
99,427
—
101,983
37,059
305,279
1,807
98
—
183,566
—
(42)
196,963
(198,242)
—
7,233
1,174,930
259,141
6,410,119
116,998
297,212
69,732
249,968
149,663
953,831
161,570
26,133
137
822,003
40,598
(335)
9,297,629
4,038,327
(3,226)
—
(4,079)
—
(31,192)
—
(977)
(145,402)
(1)
(22)
—
—
—
(184,899)
—
6,705,534
256,835
392,560
69,732
320,759
186,722
1,258,133
174,750
26,230
14,325
1,031,589
40,598
6,856
10,484,623
4,099,226
180
178,136
30,406
(183,079)
25,643
(6,442)
(791)
—
(113,546)
(4,732)
(337,272)
7,488
183,079
—
(274,181)
1,965
—
(19,942)
—
(19,942)
2,919,958
2,714,663
125,966
2,840,629
2,598,506
2,917,505
(141,089)
2,776,416
—
3,719,007
(229,517)
3,489,490
(5,518,464)
(5,518,464)
—
(5,518,464)
—
3,832,711
(244,640)
3,588,071
—
(2,274)
(745,168)
—
(747,442)
2,840,629
$
2,774,142
$
2,744,322
$ (5,518,464) $
2,840,629
130
LAS VEGAS SANDS CORP. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (CONTINUED)
CONDENSED CONSOLIDATING STATEMENTS OF OPERATIONS
For the Year Ended December 31, 2013
LVSC
(Non-Guarantor
parent)
Restricted
Subsidiaries
Non-Restricted
Subsidiaries
Consolidating/
Eliminating
Entries
Total
Revenues:
Casino ................................................. $
Rooms .................................................
Food and beverage..............................
Mall.....................................................
Convention, retail and other ...............
Less — promotional allowances................
Net revenues .......................................
Operating expenses:
Casino .................................................
Rooms .................................................
Food and beverage..............................
Mall.....................................................
Convention, retail and other ...............
Provision for doubtful accounts..........
General and administrative .................
Corporate ............................................
Pre-opening.........................................
Development.......................................
Depreciation and amortization............
Amortization of leasehold interests
in land ...............................................
(Gain) loss on disposal of assets.........
Operating income (loss).............................
Other income (expense):
Interest income....................................
Interest expense, net of amounts
capitalized .........................................
Other income (expense)......................
Loss on modification or early
retirement of debt..............................
Income from equity investments
in subsidiaries ...................................
Income before income taxes ......................
Income tax benefit (expense) .....................
Net income .................................................
Net income attributable to noncontrolling
interests ....................................................
Net income attributable to Las Vegas
Sands Corp. .............................................. $
— $
—
—
—
—
—
(1,455)
(1,455)
$
584,372
472,518
197,371
—
310,276
1,564,537
(91,217)
1,473,320
$ 10,802,545
908,163
532,888
481,400
377,791
13,102,787
(629,994)
12,472,793
— $ 11,386,917
1,380,681
—
730,259
—
481,400
—
515,179
(172,888)
14,494,436
(172,888)
(724,551)
(1,885)
13,769,885
(174,773)
—
—
—
—
—
—
—
164,926
—
15,207
26,165
314,966
157,497
90,507
—
106,242
29,977
341,659
1,264
911
—
186,871
—
(12,641)
193,657
(195,112)
—
1,823
1,231,717
241,603
6,171,744
114,449
283,366
73,358
238,296
207,809
988,927
163,287
12,428
619
794,432
40,352
21,974
9,111,041
3,361,752
(2,992)
(4)
(4,303)
—
(26,669)
—
(846)
(139,942)
—
(17)
—
—
—
(174,773)
—
6,483,718
271,942
369,570
73,358
317,869
237,786
1,329,740
189,535
13,339
15,809
1,007,468
40,352
11,156
10,361,642
3,408,243
1,155
173,203
18,189
(176,210)
16,337
(4,269)
(5,282)
—
2,416,604
2,213,096
92,901
2,305,997
(88,972)
(2,322)
(14,178)
2,119,936
2,429,270
(133,519)
2,295,751
(354,180)
11,925
176,210
—
(271,211)
4,321
—
—
(14,178)
—
3,037,686
(148,218)
2,889,468
(4,536,540)
(4,536,540)
—
(4,536,540)
—
3,143,512
(188,836)
2,954,676
—
(2,894)
(645,785)
—
(648,679)
2,305,997
$
2,292,857
$
2,243,683
$ (4,536,540) $
2,305,997
131
LAS VEGAS SANDS CORP. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (CONTINUED)
CONDENSED CONSOLIDATING STATEMENTS OF OPERATIONS
For the Year Ended December 31, 2012
LVSC
(Non-Guarantor
parent)
Restricted
Subsidiaries
Non-Restricted
Subsidiaries
Consolidating/
Eliminating
Entries
Total
Revenues:
Casino ................................................. $
Rooms .................................................
Food and beverage..............................
Mall.....................................................
Convention, retail and other ...............
Less — promotional allowances................
Net revenues .......................................
Operating expenses:
Casino .................................................
Rooms .................................................
Food and beverage..............................
Mall.....................................................
Convention, retail and other ...............
Provision for doubtful accounts..........
General and administrative .................
Corporate ............................................
Pre-opening.........................................
Development.......................................
Depreciation and amortization............
Amortization of leasehold interests
in land ...............................................
Impairment loss ..................................
(Gain) loss on disposal of assets.........
Operating income (loss).............................
Other income (expense):
Interest income....................................
Interest expense, net of amounts
capitalized .........................................
Other income (expense)......................
Loss on modification or early
retirement of debt..............................
Income from equity investments
in subsidiaries ...................................
Income before income taxes ......................
Income tax benefit (expense) .....................
Net income .................................................
Net income attributable to noncontrolling
interests ....................................................
Net income attributable to Las Vegas
Sands Corp. .............................................. $
— $
—
—
—
—
—
(1,109)
(1,109)
$
$
512,647
446,241
173,111
—
294,047
1,426,046
(84,613)
1,341,433
8,495,511
707,783
455,417
396,927
359,342
10,414,980
(466,177)
9,948,803
— $
—
—
—
(156,357)
(156,357)
(1,638)
(157,995)
9,008,158
1,154,024
628,528
396,927
497,032
11,684,669
(553,537)
11,131,132
—
—
—
—
—
—
—
188,187
—
19,973
19,921
—
—
(1)
228,080
(229,189)
288,999
138,356
85,206
—
84,957
28,987
268,834
413
1,909
—
222,096
—
—
389
1,120,146
221,287
4,841,526
98,951
250,258
68,763
239,904
210,345
793,916
148,243
141,893
—
650,029
40,165
143,674
1,852
7,629,519
2,319,284
(2,489)
(4)
(4,254)
—
(20,598)
—
(815)
(129,813)
(7)
(15)
—
—
—
—
(157,995)
—
5,128,036
237,303
331,210
68,763
304,263
239,332
1,061,935
207,030
143,795
19,958
892,046
40,165
143,674
2,240
8,819,750
2,311,382
281
135,153
21,700
(133,882)
23,252
(4,841)
(47)
(2,831)
(91,870)
792
(295,735)
4,995
133,882
—
(258,564)
5,740
(1,599)
(14,804)
—
(19,234)
1,705,354
1,468,727
55,366
1,524,093
1,430,459
1,694,222
(78,240)
1,615,982
—
2,035,440
(157,889)
1,877,551
(3,135,813)
(3,135,813)
—
(3,135,813)
—
2,062,576
(180,763)
1,881,813
—
(2,733)
(354,987)
—
(357,720)
1,524,093
$
1,613,249
$
1,522,564
$ (3,135,813) $
1,524,093
132
LAS VEGAS SANDS CORP. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (CONTINUED)
CONDENSED CONSOLIDATING STATEMENTS OF COMPREHENSIVE INCOME
For the Year Ended December 31, 2014
Net income ................................................. $
Currency translation adjustment, before
and after tax..............................................
Total comprehensive income .....................
Comprehensive income attributable to
noncontrolling interests............................
Comprehensive income attributable to Las
Vegas Sands Corp. ................................... $
LVSC
(Non-Guarantor
parent)
2,840,629
Restricted
Subsidiaries
Non-Restricted
Subsidiaries
Consolidating/
Eliminating
Entries
$
2,776,416
$
3,489,490
$ (5,518,464) $
(97,682)
2,742,947
(83,039)
2,693,377
(98,414)
3,391,076
180,721
(5,337,743)
Total
3,588,071
(98,414)
3,489,657
—
(2,274)
(744,436)
—
(746,710)
2,742,947
$
2,691,103
$
2,646,640
$ (5,337,743) $
2,742,947
133
LAS VEGAS SANDS CORP. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (CONTINUED)
CONDENSED CONSOLIDATING STATEMENTS OF COMPREHENSIVE INCOME
For the Year Ended December 31, 2013
Net income ................................................. $
Currency translation adjustment, before
and after tax..............................................
Total comprehensive income .....................
Comprehensive income attributable to
noncontrolling interests............................
Comprehensive income attributable to Las
Vegas Sands Corp. ................................... $
LVSC
(Non-Guarantor
parent)
2,305,997
Restricted
Subsidiaries
Non-Restricted
Subsidiaries
Consolidating/
Eliminating
Entries
$
2,295,751
$
2,889,468
$ (4,536,540) $
(89,295)
2,216,702
(75,797)
2,219,954
(89,976)
2,799,492
165,092
(4,371,448)
Total
2,954,676
(89,976)
2,864,700
—
(2,894)
(645,104)
—
(647,998)
2,216,702
$
2,217,060
$
2,154,388
$ (4,371,448) $
2,216,702
134
LAS VEGAS SANDS CORP. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (CONTINUED)
CONDENSED CONSOLIDATING STATEMENTS OF COMPREHENSIVE INCOME
For the Year Ended December 31, 2012
LVSC
(Non-Guarantor
parent)
1,524,093
Restricted
Subsidiaries
Non-Restricted
Subsidiaries
Consolidating/
Eliminating
Entries
$
1,615,982
$
1,877,551
$ (3,135,813) $
Total
1,881,813
Net income ................................................. $
Currency translation adjustment, net of
reclassification adjustment and before
and after tax..............................................
Total comprehensive income .....................
Comprehensive income attributable to
noncontrolling interests............................
Comprehensive income attributable to Las
Vegas Sands Corp. ................................... $
168,974
1,693,067
143,570
1,759,552
172,788
2,050,339
(312,544)
(3,448,357)
172,788
2,054,601
—
(2,733)
(358,801)
—
(361,534)
1,693,067
$
1,756,819
$
1,691,538
$ (3,448,357) $
1,693,067
135
LAS VEGAS SANDS CORP. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (CONTINUED)
CONDENSED CONSOLIDATING STATEMENTS OF CASH FLOWS
For the Year Ended December 31, 2014
Net cash generated from operating activities ......... $
Cash flows from investing activities:
LVSC
(Non-Guarantor
parent)
3,223,393
Restricted
Subsidiaries
Non-Restricted
Subsidiaries
Consolidating/
Eliminating
Entries
$
2,915,949
$
4,643,445
$ (5,949,943) $
Change in restricted cash and cash
equivalents ....................................................
Capital expenditures .......................................
Proceeds from disposal of property and
equipment .....................................................
Repayments of receivable from
non-restricted subsidiaries ............................
Notes receivable to Las Vegas Sands Corp.....
Dividends received from non-restricted
subsidiaries ...................................................
Capital contributions to subsidiaries...............
Net cash used in investing activities ......................
Cash flows from financing activities:
Proceeds from exercise of stock options ........
Excess tax benefit from stock option
exercises .......................................................
Repurchase of common stock.........................
Dividends paid ................................................
Distributions to noncontrolling interests ........
Dividends paid to Las Vegas Sands Corp.......
Dividends paid to Restricted Subsidiaries ......
Capital contributions received ........................
Borrowings from non-restricted subsidiaries..
Repayments on borrowings from Restricted
Subsidiaries ..................................................
Proceeds from 2013 U.S. credit facility .........
Proceeds from 2011 VML credit facility........
Repayments on 2013 U.S. credit facility ........
Repayments on 2011 VML credit facility.......
Repayments on 2012 Singapore credit
facility ..........................................................
Repayments on airplane financings ................
Repayments on HVAC equipment lease and
other long-term debt .....................................
Payments of deferred financing costs .............
Net cash used in financing activities ......................
Effect of exchange rate on cash .............................
Increase (decrease) in cash and cash equivalents...
Cash and cash equivalents at beginning of year.....
Cash and cash equivalents at end of year ............... $
Total
4,832,844
270
(1,178,656)
1,818
—
—
—
(31,626)
—
(102,502)
270
(1,044,528)
42
—
—
671
1,889
—
1,105
—
(114,155)
—
—
—
(1,889)
114,155
—
—
(31,584)
1,418,221
(1,327,991)
(9,712)
—
—
(1,157,308)
(1,418,221)
1,327,991
22,036
—
—
(1,176,568)
44,973
—
10,677
—
55,650
3,585
(1,676,802)
(1,610,087)
—
—
—
—
114,155
—
—
—
—
—
—
(3,688)
—
—
(3,127,864)
—
63,945
50,180
114,125
—
—
—
(2,274)
(3,279,161)
—
—
—
—
1,678,000
—
(1,270,500)
—
—
—
—
—
(776,570)
(7,499)
(129,416)
(3,959,587)
1,327,991
—
(1,889)
—
819,725
—
(819,680)
(17,930)
—
—
—
—
—
3,408,577
3,959,587
(1,327,991)
(114,155)
1,889
—
—
—
—
—
—
3,585
(1,676,802)
(2,386,657)
(9,773)
—
—
—
—
—
1,678,000
819,725
(1,270,500)
(819,680)
(17,930)
(3,688)
(2,392)
—
(2,876,327)
—
29,910
315,489
345,399
(3,276)
(88,048)
(3,645,502)
(28,585)
(187,950)
3,234,745
3,046,795
$
$
$
—
—
5,927,907
—
—
—
— $
(5,668)
(88,048)
(3,721,786)
(28,585)
(94,095)
3,600,414
3,506,319
136
LAS VEGAS SANDS CORP. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (CONTINUED)
CONDENSED CONSOLIDATING STATEMENTS OF CASH FLOWS
For the Year Ended December 31, 2013
Net cash generated from operating activities ......... $
Cash flows from investing activities:
LVSC
(Non-Guarantor
parent)
1,693,766
Restricted
Subsidiaries
Non-Restricted
Subsidiaries
Consolidating/
Eliminating
Entries
$
1,892,021
$
4,255,589
$ (3,401,964) $
Change in restricted cash and cash
equivalents ....................................................
Capital expenditures .......................................
Proceeds from disposal of property and
equipment .....................................................
Acquisition of intangible assets ......................
Repayments of receivable from
non-restricted subsidiaries ............................
Notes receivable to Las Vegas Sands Corp.....
Repayments of receivable from Las Vegas
Sands Corp. ..................................................
Dividends received from non-restricted
subsidiaries ...................................................
Capital contributions to subsidiaries...............
Net cash generated from (used in) investing
activities ...............................................................
Cash flows from financing activities:
Proceeds from exercise of stock options ........
Repurchase of common stock.........................
Proceeds from exercise of warrants ................
Dividends paid ................................................
Distributions to noncontrolling interests ........
Dividends paid to Las Vegas Sands Corp.......
Dividends paid to Restricted Subsidiaries ......
Capital contributions received ........................
Borrowings from non-restricted subsidiaries..
Repayments on borrowings from Restricted
Subsidiaries ..................................................
Repayments on borrowings from
non-restricted subsidiaries ............................
Proceeds from 2013 U.S. credit facility .........
Proceeds from senior secured credit facility...
Proceeds from 2012 Singapore credit facility
Repayments on senior secured credit facility .
Repayments on 2012 Singapore credit
facility ..........................................................
Repayments on airplane financings ................
Repayments on HVAC equipment lease and
other long-term debt .....................................
Payments of deferred financing costs .............
Net cash used in financing activities ......................
Effect of exchange rate on cash .............................
Increase in cash and cash equivalents ....................
Cash and cash equivalents at beginning of year.....
Cash and cash equivalents at end of year ............... $
Total
4,439,412
(382)
(898,111)
32,155
(45,871)
—
—
—
—
—
—
(29,901)
31,000
—
—
—
—
1
(91,900)
121
—
1,357
—
(383)
(776,310)
1,034
(45,871)
—
(251,537)
—
—
—
—
(1,357)
251,537
—
237,161
(237,161)
—
(68)
1,383,116
(1,292,416)
—
—
(1,383,116)
1,292,484
1,031
279
(835,906)
(77,613)
(912,209)
50,223
(561,150)
350
(1,152,690)
—
—
—
—
251,537
—
—
—
—
(2,894)
(1,732,152)
—
—
—
19,373
—
—
(411,359)
(8,964)
(108,570)
(2,944,358)
1,292,484
—
—
—
—
—
—
1,840,722
2,944,358
(1,292,484)
(251,537)
69,596
(561,150)
350
(1,564,049)
(11,858)
—
—
—
—
—
—
(1,357)
1,357
—
(237,161)
—
—
—
—
—
(3,688)
—
2,828,750
250,000
—
(3,073,038)
—
—
—
—
(1,652,579)
—
42,218
7,962
50,180
(2,350)
(27,529)
(1,759,213)
—
133,087
182,402
315,489
$
$
—
—
—
104,357
—
(430,504)
—
(3,452)
(7,885)
(2,500,235)
(7,105)
912,343
2,322,402
3,234,745
237,161
—
—
—
—
—
—
—
2,828,750
250,000
104,357
(3,073,038)
(430,504)
(3,688)
—
—
3,479,577
—
—
—
— $
(5,802)
(35,414)
(2,432,450)
(7,105)
1,087,648
2,512,766
3,600,414
$
137
LAS VEGAS SANDS CORP. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (CONTINUED)
CONDENSED CONSOLIDATING STATEMENTS OF CASH FLOWS
For the Year Ended December 31, 2012
Net cash generated from operating activities ......... $
Cash flows from investing activities:
LVSC
(Non-Guarantor
parent)
2,544,296
Restricted
Subsidiaries
Non-Restricted
Subsidiaries
Consolidating/
Eliminating
Entries
$
2,177,182
$
2,894,423
$ (4,558,144) $
Total
3,057,757
Change in restricted cash and cash
equivalents ....................................................
Capital expenditures .......................................
Proceeds from disposal of property and
equipment .....................................................
Intercompany receivable to non-restricted
subsidiaries ...................................................
Repayments of receivable from
non-restricted subsidiaries ............................
Notes receivable to Las Vegas Sands Corp.....
Notes receivable to non-restricted
subsidiaries ...................................................
Dividends received from non-restricted
subsidiaries ...................................................
Capital contributions to subsidiaries...............
Net cash used in investing activities ......................
Cash flows from financing activities:
Proceeds from exercise of stock options ........
Proceeds from exercise of warrants ................
Dividends paid ................................................
Distributions to noncontrolling interests ........
Deemed distribution to Principal Stockholder
Dividends paid to Las Vegas Sands Corp.......
Dividends paid to Restricted Subsidiaries ......
Capital contributions received ........................
Borrowings from Las Vegas Sands Corp........
Borrowings from Restricted Subsidiaries.......
Borrowings from non-restricted subsidiaries..
Repayments on borrowings from Restricted
Subsidiaries ..................................................
Proceeds from 2012 Singapore credit facility
Proceeds from senior secured credit facility...
Repayments on Singapore credit facility ........
Repayments on senior secured credit facility .
Redemption of senior notes ............................
Repayments on ferry financing ......................
Repayments on airplane financings ................
Repayments on HVAC equipment lease and
other long-term debt .....................................
Payments of deferred financing costs .............
Net cash used in financing activities ......................
Effect of exchange rate on cash .............................
Decrease in cash and cash equivalents ...................
Cash and cash equivalents at beginning of year.....
Cash and cash equivalents at end of year ............... $
(1)
(155,936)
694
(1,242,395)
2,455
—
—
—
693
(1,449,234)
2,909
—
20,297
—
(237,161)
(683)
237,161
(9,773)
—
9,773
—
—
—
—
—
—
(1,445,632)
46,240
528,908
(3,442,312)
(10,466)
(18,576)
—
—
—
—
—
—
—
3,951,486
400,000
(3,635,676)
(425,555)
(189,712)
(140,337)
(3,688)
(4,730)
(100,888)
(3,045,306)
43,229
(1,389,952)
3,902,718
2,512,766
—
—
(1,476,407)
11,572
—
(357,056)
(7,733)
(18,576)
(181,191)
(4,372,553)
2,485,064
20,297
9,773
—
(683)
3,951,486
—
(3,635,676)
—
—
(140,337)
—
(2,569)
(100,888)
(2,339,070)
43,229
(877,825)
3,200,227
2,322,402
(2,564,500)
2,485,064
187,112
—
—
—
—
—
2,750,091
4,372,553
(2,485,064)
(20,297)
(9,773)
(237,161)
683
—
—
—
—
—
—
—
—
—
4,371,032
—
—
—
— $
$
—
(50,903)
—
(20,297)
—
—
—
—
(64)
(71,264)
34,668
528,908
(3,085,256)
—
—
—
—
—
—
—
237,161
—
—
—
—
—
(189,712)
—
(3,688)
454
—
683
—
2,564,500
(2,485,000)
(85,073)
—
—
—
(2,733)
—
(2,568,900)
—
—
—
—
—
—
—
400,000
—
(425,555)
—
—
—
—
—
(2,477,919)
—
(4,887)
12,849
7,962
(2,161)
—
(2,599,349)
—
(507,240)
689,642
182,402
$
$
138
LAS VEGAS SANDS CORP. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (CONTINUED)
Note 19 — Selected Quarterly Financial Results (Unaudited)
2014
Net revenues ................................. $
Operating income .........................
Net income ...................................
Net income attributable to Las
Vegas Sands Corp.......................
Basic earnings per share ...............
Diluted earnings per share............
2013
Net revenues ................................. $
Operating income .........................
Net income ...................................
Net income attributable to Las
Vegas Sands Corp.......................
Basic earnings per share ...............
Diluted earnings per share............
________________________
(1)
First
Second
Quarter
Third
(2)
Fourth
Total
(In thousands, except per share data)
$
$
$
$
4,010,384
1,143,825
996,728
776,185
0.95
0.95
3,302,719
826,703
703,974
571,961
0.69
0.69
3,624,350
961,460
852,844
671,434
0.83
0.83
3,242,941
780,641
671,673
529,753
0.64
0.64
$
$
3,533,122
971,421
860,499
671,705
0.84
0.83
3,568,540
914,826
809,298
626,744
0.76
0.76
3,415,993
1,022,520
878,000
$ 14,583,849
4,099,226
3,588,071
721,305
0.90
0.90
2,840,629
3.52
3.52
3,655,685
886,073
769,731
$ 13,769,885
3,408,243
2,954,676
577,539
0.71
0.70
2,305,997
2.80
2.79
(1) The second Sheraton tower of Sands Cotai Central opened in January 2013.
(2) The Company received a $90.1 million refund during December 2014 related to a property tax settlement at
Marina Bay Sands for the years 2010 through 2014.
Because earnings per share amounts are calculated using the weighted average number of common and dilutive
common equivalent shares outstanding during each quarter, the sum of the per share amounts for the four quarters may
not equal the total earnings per share amounts for the respective year.
139
SCHEDULE II — VALUATION AND QUALIFYING ACCOUNTS
LAS VEGAS SANDS CORP. AND SUBSIDIARIES
For the Years Ended December 31, 2014, 2013 and 2012
Description
Allowance for doubtful accounts:
Balance at
Beginning
of Year
Provision
for
Doubtful
Accounts
Write-offs,
Net of
Recoveries
Balance
at End
of Year
(In thousands)
2012 ........................................................
2013 ........................................................
2014 ........................................................
$
$
$
275,066
491,682
629,727
239,332
237,786
186,722
(22,716) $
(99,741) $
(143,164) $
491,682
629,727
673,285
Description
Deferred income tax asset valuation
allowance:
Balance at
Beginning
of Year
Additions
Deductions
(In thousands)
Balance
at End
of Year
2012 ........................................................
2013 ........................................................
2014 ........................................................
$
$
$
325,239
1,390,900
1,519,268
1,088,812
149,893
1,012,126
(23,151) $
(21,525) $
(46,741) $
1,390,900
1,519,268
2,484,653
140
ITEM 9. — CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND
FINANCIAL DISCLOSURE
Not applicable.
ITEM 9A. — CONTROLS AND PROCEDURES
Evaluation of Disclosure Controls and Procedures
Disclosure controls and procedures are designed to ensure that information required to be disclosed in the reports
that the Company files or submits under the Securities Exchange Act of 1934 is recorded, processed, summarized and
reported within the time periods specified in the SEC’s rules and forms and that such information is accumulated and
communicated to the Company’s management, including its principal executive officer and principal financial officer,
as appropriate, to allow for timely decisions regarding required disclosure. The Company’s Chief Executive Officer
and its Chief Accounting Officer (Principal Financial Officer) have evaluated the disclosure controls and procedures
(as defined in the Securities Exchange Act of 1934 Rules 13a-15(e) and 15d-15(e)) of the Company as of December 31,
2014, and have concluded that they are effective at the reasonable assurance level.
It should be noted that any system of controls, however well designed and operated, can provide only reasonable,
and not absolute, assurance that the objectives of the system are met. In addition, the design of any control system is
based in part upon certain assumptions about the likelihood of future events. Because of these and other inherent
limitations of control systems, there can be no assurance that any design will succeed in achieving its stated goals under
all potential future conditions, regardless of how remote.
Changes in Internal Control over Financial Reporting
There were no changes in the Company’s internal control over financial reporting that occurred during the fourth
quarter covered by this Annual Report on Form 10-K that had a material effect, or was reasonably likely to have a
material effect, on the Company’s internal control over financial reporting.
Management’s Annual Report on Internal Control Over Financial Reporting
The Company’s management is responsible for establishing and maintaining adequate internal control over
financial reporting, as defined in Rules 13a-15(f) and 15d-15(f) of the Securities Exchange Act of 1934. The Company’s
internal control over financial reporting is designed to provide reasonable assurance regarding the reliability of financial
reporting and the preparation of financial statements for external purposes in accordance with generally accepted
accounting principles. The Company’s internal control over financial reporting includes those policies and procedures
that:
(1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the
transactions and dispositions of the Company’s assets;
(2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of
financial statements in accordance with generally accepted accounting principles and that the Company’s receipts and
expenditures are being made only in accordance with authorizations of its management and directors; and
(3) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use
or disposition of the Company’s assets that could have a material effect on the financial statements.
Because of its inherent limitations, internal control over financial reporting may not prevent or detect
misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls
may become inadequate because of changes in conditions, or that the degree of compliance with the policies or
procedures may deteriorate.
The Company’s management assessed the effectiveness of the Company’s internal control over financial reporting
as of December 31, 2014. In making this assessment, the Company’s management used the framework set forth by the
Committee of Sponsoring Organizations of the Treadway Commission in “Internal Control — Integrated Framework
(2013).”
141
Based on this assessment, management concluded that, as of December 31, 2014, the Company’s internal control
over financial reporting is effective based on this framework.
The effectiveness of the Company’s internal control over financial reporting as of December 31, 2014, has been
audited by Deloitte & Touche LLP, an independent registered public accounting firm, as stated in their report, which
appears herein.
ITEM 9B. — OTHER INFORMATION
None.
PART III
ITEM 10. — DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE
We incorporate by reference the information responsive to this Item appearing in our definitive Proxy Statement
for our 2015 Annual Meeting of Stockholders, which we expect to file with the Securities and Exchange Commission
on or about April 24, 2015 (the “Proxy Statement”), including under the captions “Board of Directors,” “Executive
Officers,” “Section 16(a) Beneficial Ownership Reporting Compliance” and “Information Regarding the Board of
Directors and Its Committees.”
We have adopted a Code of Business Conduct and Ethics, which is posted on our website at www.sands.com,
along with any amendments or waivers to the Code. Copies of the Code of Business Conduct and Ethics are available
without charge by sending a written request to Investor Relations at the following address: Las Vegas Sands Corp.,
3355 Las Vegas Boulevard South, Las Vegas, Nevada 89109.
ITEM 11. — EXECUTIVE COMPENSATION
We incorporate by reference the information responsive to this Item appearing in the Proxy Statement, including
under the captions “Executive Compensation and Other Information,” “Director Compensation,” “Information
Regarding the Board of Directors and Its Committees” and “Compensation Committee Report” (which report is deemed
to be furnished and is not deemed to be filed in any Company filing under the Securities Act of 1933 or the Securities
Exchange Act of 1934).
ITEM 12. — SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND
RELATED STOCKHOLDER MATTERS
We incorporate by reference the information responsive to this Item appearing in the Proxy Statement, including
under the captions “Equity Compensation Plan Information” and “Principal Stockholders.”
ITEM 13. — CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS, AND DIRECTOR
INDEPENDENCE
We incorporate by reference the information responsive to this Item appearing in the Proxy Statement, including
under the captions “Board of Directors,” “Information Regarding the Board of Directors and its Committees” and
“Certain Transactions.”
ITEM 14. — PRINCIPAL ACCOUNTANT FEES AND SERVICES
We incorporate by reference the information responsive to this Item appearing in the Proxy Statement, under the
caption “Fees Paid to Independent Registered Public Accounting Firm.”
142
PART IV
ITEM 15. — EXHIBITS AND FINANCIAL STATEMENT SCHEDULES
(a) Documents filed as part of the Annual Report on Form 10-K.
(1) List of Financial Statements
Reports of Independent Registered Public Accounting Firms
Consolidated Balance Sheets
Consolidated Statements of Operations
Consolidated Statements of Comprehensive Income
Consolidated Statements of Equity
Consolidated Statements of Cash Flows
Notes to Consolidated Financial Statements
(2) List of Financial Statement Schedule
Schedule II — Valuation and Qualifying Accounts
(3) List of Exhibits
Exhibit No.
3.1
3.2
4.1
10.1
10.2
10.3
Description of Document
Certificate of Amended and Restated Articles of Incorporation of Las Vegas Sands Corp.
(incorporated by reference from Exhibit 3.1 to the Company’s Amendment No. 2 to Registration
Statement on Form S-1 (File No. 333-118827) filed on November 22, 2004).
Amended and Restated By-laws of Las Vegas Sands Corp.
Form of Specimen Common Stock Certificate of Las Vegas Sands Corp. (incorporated by
reference from Exhibit 4.1 to the Company’s Amendment No. 2 to Registration Statement on
Form S-1 (File No. 333-118827) filed on November 22, 2004).
Amendment and Restatement Agreement dated as of December 19, 2013, to the Amended and
Restated Credit and Guaranty Agreement dated as of August 18, 2010 among Las Vegas Sands,
LLC, the Guarantors party thereto, the Lenders party thereto and The Bank of Nova Scotia
(including as Exhibit A thereto the Second Amended and Restated Credit and Guaranty
Agreement dated as of December 19, 2013 among Las Vegas Sands, LLC, the Guarantors party
thereto, the lenders party thereto, The Bank of Nova Scotia, Barclays Bank PLC, Citigroup Global
Markets Inc., Merrill Lynch, Pierce, Fenner & Smith Incorporated, BNP Paribas Securities Corp.,
Goldman Sachs Bank USA, Credit Agricole Corporate & Investment Bank, Morgan Stanley
Senior Funding, Inc., The Royal Bank of Scotland plc and Sumitomo Mitsui Banking
Corporation)(incorporated by reference from Exhibit 10.2 to the Company’s Annual Report on
Form 10-K (File No. 001-32373) for the year ended December 31, 2013 and filed on February 28,
2014).
Second Amended and Restated Security Agreement, dated as of December 19, 2013, between
each of the parties named as a grantor therein and The Bank of Nova Scotia, as collateral agent for
the secured parties, as defined therein (incorporated by reference from Exhibit 10.3 to the
Company’s Annual Report on Form 10-K (File No. 001-32373) for the year ended December 31,
2013 and filed on February 28, 2014).
Amendment and Restatement Agreement dated as of March 25, 2014, among VML US Finance
LLC, as Borrower, Guarantors Party Hereto, Lender Party Hereto and Bank of China Limited,
Macau Branch, as Administrative Agent and Collateral Agent (incorporated by reference from
Exhibit 10.1 to the Company's Quarterly Report on Form 10-Q (File No. 001-32373) for the
quarter ended March 31, 2014) and filed on May 7, 2014.
143
Exhibit No.
10.4
10.5
10.6
10.7
10.8
10.9
Description of Document
Credit Agreement, dated as of September 21, 2011, entered into by and among VML US Finance
LLC, Venetian Macau Limited, the financial institutions listed on the signature pages thereto as
Lenders, Bank of China Limited, Macau Branch (“BOC”), as administrative agent for the
Lenders, Goldman Sachs (Asia) L.L.C., Goldman Sachs Lending Partners LLC, Bank of America,
N.A., BOC, Barclays Capital, BNP Paribas Hong Kong Branch, Citigroup Global Markets Asia
Limited, Citibank, N.A. Hong Kong Branch, Commerzbank AG, Credit Agricole Corporate and
Investment Bank, Credit Suisse Securities (USA) LLC, Credit Suisse AG, Singapore Branch,
Industrial and Commercial Bank of China (Macau) Limited, ING Capital L.L.C. and ING Bank
NV, Singapore Bank, Sumitomo Mitsui Banking Corporation, UBS Securities LLC and United
Overseas Bank Limited, as global coordinators and bookrunners for the Term Loan Facility and
Revolving Credit Facility and as co-syndication agents for the Term Loan Lenders and Revolving
Loan Lenders and Banco Nacional Ultramarino, S.A., DBS Bank Ltd., Oversea-Chinese Banking
Corporation Limited, The Bank of Nova Scotia and Wing Lung Bank Ltd., Macau Branch, as lead
arrangers for the Term Loan Facility and Revolving Credit Facility (incorporated by reference
from Exhibit 10.1 to the Company’s Quarterly Report on Form 10-Q (File No. 001-32373) for the
quarter ended September 30, 2011 and filed on November 9, 2011).
Credit Agreement, dated as of May 17, 2010, by and among Venetian Orient Limited, the financial
institutions listed as Lenders on the signature pages thereto, The Bank of Nova Scotia, as
Administrative Agent, Goldman Sachs Lending Partners LLC, BNP Paribas, Hong Kong Branch,
Citibank, N.A., Citigroup Financial Services Limited and Citibank, N.A., Hong Kong Branch,
UBS AG Hong Kong Branch, Barclays Capital, The Investment Banking Division of Barclays
PLC, Bank of China Limited, Macau Branch (“BOC”), and Industrial and Commercial Bank of
China (Macau) Limited (“ICBC”), as Global Coordinators and Bookrunners, and, with the
exception of BOC and ICBC, as co-syndication agents for the enders, and Banco Nacional
Ultramarino, S.A., DBS Bank Ltd. and Oversea-Chinese Banking Corporation Limited, as
Mandated Lead Arrangers and Bookrunners (incorporated by reference from Exhibit 10.1 to the
Company’s Quarterly Report on Form 10-Q (File No. 001-32373) for the quarter ended June 30,
2010 and filed on August 9, 2010).
Sponsor Agreement, dated as of May 17, 2010, by and between Sands China Ltd., The Bank of
Nova Scotia, as administrative agent, and Bank of China Limited, Macau Branch, as the collateral
agent (incorporated by reference from Exhibit 10.2 to the Company’s Quarterly Report on
Form 10-Q (File No. 001-32373) for the quarter ended June 30, 2010 and filed on August 9,
2010).
Guaranty, dated as of May 17, 2010, is made by Sands China Ltd., and each Subsidiary of Sands
China Ltd. Required from time to time to become party hereto pursuant to the Credit Agreement,
in favor of and for the benefit of The Bank of Nova Scotia, as administrative agent (incorporated
by reference from Exhibit 10.3 to the Company’s Quarterly Report on Form 10-Q (File
No. 001-32373) for the quarter ended June 30, 2010 and filed on August 9, 2010).
Amendment and Restatement Agreement dated as of August 29, 2014, to the Facility Agreement,
dated as of June 25, 2012 (as amended by an amendment agreement dated November 20, 2013),
among Marina Bay Sands Pte, Ltd., as borrower, various lenders party thereto, DBS Bank Ltd.
(“DBS”), Oversea-Chinese Banking Corporation Limited, United Overseas Bank Limited and
Malayan Banking Berhad, Singapore Branch, as global coordinators, DBS, as agent and security
trustee, and DBS, Oversea-Chinese Banking Corporation Limited, United Overseas Bank
Limited, Malayan Banking Berhad, Singapore Branch, Standard Chartered Bank, Sumitomo
Mitsui Banking Corporation and CIMB Bank Berhad, Singapore Branch, as mandated lead
arrangers (including as Schedule 3 thereto, the Form of Amended and Restated Facility
Agreement) (incorporated by reference from Exhibit 10.1 to the Company's Quarterly Report on
Form 10-Q (File No. 001-32373) for the quarter ended September 30, 2014) and filed on
November 5, 2014.
Facility Agreement, dated as of June 25, 2012, among Marina Bay Sands Pte. Ltd., as borrower,
DBS Bank Ltd., Oversea-Chinese Banking Corporation Limited, United Overseas Bank Limited
and Malayan Banking Berhad, Singapore Branch, as global coordinators, DBS Bank Ltd., as
agent for the finance parties and security trustee for the secured parties and certain other lenders
party thereto (incorporated by reference from Exhibit 10.2 to the Company’s Quarterly Report on
Form 10-Q (File No. 001-32373) for the quarter ended June 30, 2012 and filed on August 9,
2012).
144
Exhibit No.
10.10
10.11
10.12
10.13
10.14
10.15†
10.16
10.17
10.18
10.19
10.20
10.21
10.22
Description of Document
Construction Agency Agreement, dated as of May 1, 1997, by and between Venetian Casino
Resort, LLC and Atlantic Pacific Las Vegas, LLC (incorporated by reference from Exhibit 10.21
to Amendment No. 2 to Las Vegas Sands, Inc.’s Registration Statement on Form S-4 (File
No. 333-42147) dated March 27, 1998).
Sands Resort Hotel and Casino Agreement, dated as of February 18, 1997, by and between Clark
County and Las Vegas Sands, Inc. (incorporated by reference from Exhibit 10.27 to Amendment
No. 1 to Las Vegas Sands, Inc.’s Registration Statement on Form S-4 (File No. 333-42147) dated
February 12, 1998).
Addendum to Sands Resort Hotel and Casino Agreement, dated as of September 16, 1997, by and
between Clark County and Las Vegas Sands, Inc. (incorporated by reference from Exhibit 10.20
to the Company’s Amendment No. 1 to Registration Statement on Form S-1 (File
No. 333-118827) dated October 25, 2004).
Improvement Phasing Agreement by and between Clark County and Lido Casino Resort, LLC
(incorporated by reference from Exhibit 10.21 to the Company’s Amendment No. 1 to
Registration Statement on Form S-1 (File No. 333-118827) dated October 22, 2004).
Concession Contract for Operating Casino Games of Chance or Games of Other Forms in the
Macao Special Administrative Region, June 26, 2002, by and among the Macao Special
Administrative Region and Galaxy Casino Company Limited (incorporated by reference from
Exhibit 10.40 to Las Vegas Sands, Inc.’s Form 10-K (File No. 333-42147) for the year ended
December 31, 2002 and filed on March 31, 2003).
Subconcession Contract for Operating Casino Games of Chance or Games of Other Forms in the
Macao Special Administrative Region, dated December 19, 2002, between Galaxy Casino
Company Limited, as concessionaire, and Venetian Macau S.A., as subconcessionaire
(incorporated by reference from Exhibit 10.65 to the Company’s Amendment No. 5 to
Registration Statement on Form S-1 (File No. 333-118827) dated December 10, 2004).
Land Concession Agreement, dated as of December 10, 2003, relating to the Sands Macao
between the Macao Special Administrative Region and Venetian Macau Limited (incorporated by
reference from Exhibit 10.39 to the Company’s Amendment No. 1 to Registration Statement on
Form S-1 (File No. 333-118827) dated October 25, 2004).
Amendment, published on April 22, 2008, to Land Concession Agreement, dated as of
December 10, 2003, relating to the Sands Macao between the Macau Special Administrative
Region and Venetian Macau Limited (incorporated by reference from Exhibit 10.3 to the
Company’s Quarterly Report on Form 10-Q (File No. 001-32373) for the quarter ended March 31,
2008 and filed on May 9, 2008).
Land Concession Agreement, dated as of February 23, 2007, relating to the Venetian Macao, Four
Seasons Macao and Site 3 among the Macau Special Administrative Region, Venetian Cotai
Limited and Venetian Macau Limited (incorporated by reference from Exhibit 10.3 to the
Company’s Quarterly Report on Form 10-Q (File No. 001-32373) for the quarter ended March 31,
2007 and filed on May 10, 2007).
Amendment published on October 28, 2008, to Land Concession Agreement between Macau
Special Administrative Region and Venetian Cotai Limited (incorporated by reference from
Exhibit 10.5 to the Company’s Quarterly Report on Form 10-Q (File No. 001-32373) for the
quarter ended September 30, 2008 and filed on November 10, 2008).
Development Agreement, dated August 23, 2006, between the Singapore Tourism Board and
Marina Bay Sands Pte. Ltd. (incorporated by reference from Exhibit 10.3 to the Company’s
Quarterly Report on Form 10-Q (File No. 001-32373) for the quarter ended September 30, 2006
and filed on November 9, 2006).
Supplement to Development Agreement, dated December 11, 2009, by and between Singapore
Tourism Board and Marina Bay Sands PTE. LTD (incorporated by reference from Exhibit 10.76
to the Company’s Annual Report on Form 10-K (File No. 001-32373) for the year ended
December 31, 2009 and filed on March 1, 2010).
Energy Services Agreement, dated as of May 1, 1997, by and between Atlantic Pacific Las Vegas,
LLC and Venetian Casino Resort, LLC (incorporated by reference from Exhibit 10.3 to
Amendment No. 2 to Las Vegas Sands, Inc.’s Registration Statement on Form S-4 (File
No. 333-42147) dated March 27, 1998).
145
Exhibit No.
10.23
10.24
10.25
10.26
10.27
10.28
10.29
10.30
10.31+
10.32+
10.33+
10.34+
10.35+
10.36+
Description of Document
Energy Services Agreement Amendment No. 1, dated as of July 1, 1999, by and between Atlantic
Pacific Las Vegas, LLC and Venetian Casino Resort, LLC (incorporated by reference from
Exhibit 10.8 to Las Vegas Sands, Inc.’s Annual Report on Form 10-K (File No. 333-42147) for the
year ended December 31, 1999 and filed on March 30, 2000).
Energy Services Agreement Amendment No. 2, dated as of July 1, 2006, by and between Atlantic
Pacific Las Vegas, LLC and Venetian Casino Resort, LLC (incorporated by reference from
Exhibit 10.77 to the Company’s Annual Report on Form 10-K (File No. 001-32373) for the year
ended December 31, 2006 and filed on February 28, 2007).
Energy Services Agreement Amendment No. 3 dated as of February 10, 2009, by and between
Trigen-Las Vegas Energy Company, LLC f/k/a Atlantic Pacific Las Vegas, LLC, Venetian Casino
Resort, LLC Grand Canal Shops II, LLC and Interface Group-Nevada, Inc. (incorporated by
reference from Exhibit 10.34 to the Company’s Annual Report on Form 10-K (File No.
001-32373) for year ended December 31, 2010 and filed on March 1, 2011).
Energy Services Agreement, dated as of November 14, 1997, by and between Atlantic-Pacific Las
Vegas, LLC and Interface Group-Nevada, Inc. (incorporated by reference from Exhibit 10.8 to
Amendment No. 1 of the Company’s Registration Statement on Form S-1 (File No. 333-118827)
dated October 25, 2004).
Energy Services Agreement Amendment No. 1, dated as of July 1, 1999, by and between Atlantic-
Pacific Las Vegas, LLC and Interface Group-Nevada, Inc. (incorporated by reference from
Exhibit 10.9 to the Company’s Amendment No. 1 to Registration Statement on Form S-1 (File
No. 333-118827) dated October 25, 2004).
Amended and Restated Services Agreement, dated as of November 14, 1997, by and among Las
Vegas Sands, Inc., Venetian Casino Resort, LLC, Interface Group Holding Company, Inc.,
Interface Group-Nevada, Inc., Lido Casino Resort MM, Inc., Grand Canal Shops Mall MM
Subsidiary, Inc. and certain subsidiaries of Venetian Casino Resort, LLC named therein
(incorporated by reference from Exhibit 10.15 to Amendment No. 1 to Las Vegas Sands, Inc.’s
Registration Statement on Form S-4 (File No. 333-42147) dated February 12, 1998).
Assignment and Assumption Agreement, dated as of November 8, 2004, by and among Las Vegas
Sands, Inc., Venetian Casino Resort, LLC, Interface Group Holding Company, Inc., Interface
Group-Nevada, Inc., Interface Operations LLC, Lido Casino Resort MM, Inc., Grand Canal
Shops Mall MM Subsidiary, Inc. and certain subsidiaries of Venetian Casino Resort, LLC named
therein (incorporated by reference from Exhibit 10.52 to the Company’s Amendment No. 2 to
Registration Statement on Form S-1 (File No. 333-118827) dated November 22, 2004).
Fourth Amended and Restated Reciprocal Easement, Use and Operating Agreement, dated as of
February 29, 2008, by and among Interface Group — Nevada, Inc., Grand Canal Shops II, LLC,
Phase II Mall Subsidiary, LLC, Venetian Casino Resort, LLC, and Palazzo Condo Tower, LLC
(incorporated by reference from Exhibit 10.1 to the Company’s Quarterly Report on Form 10-Q
(File No. 001-32373) for the quarter ended March 31, 2008 and filed on May 9, 2008).
Las Vegas Sands Corp. 2004 Equity Award Plan (Amended and Restated) (incorporated by
reference from Exhibit 10.1 to the Company’s Quarterly Report on Form 10-Q (File No.
001-32373) for the quarter ended June 30, 2014 and filed on August 7, 2014).
Form of Director Restricted Stock Award Agreement under the 2004 Equity Award Plan
(incorporated by reference from Exhibit 10.2 to the Company’s Quarterly Report on Form 10-Q
(File No. 001-32373) for the quarter ended June 30,. 2014 and filed on August 7, 2014).
Form of Restricted Stock Award Agreement under the 2004 Equity Award Plan (incorporated by
reference from Exhibit 10.3 to the Company's Quarterly Report on Form 10-Q (File No.
001-32373) for the quarter ended June 30, 2014) and filed on August 7, 2014.
Form of Restricted Stock Award Agreements under the 2004 Equity Award Plan (incorporated by
reference from Exhibit 10.70 to the Company’s Amendment No. 4 to Registration Statement on
Form S-1 (File No. 333-118827) dated December 8, 2004).
Form of Restricted Stock Award Agreement under the 2004 Equity Award Plan (incorporated by
reference from Exhibit 10.48 to the Company’s Annual Report on Form 10-K (File No.
001-32373) for year ended December 31, 2010 and filed on March 1, 2011).
Form of Nonqualified Stock Option Agreements under the 2004 Equity Award Plan (incorporated
by reference from Exhibit 10.71 to the Company’s Amendment No. 4 to Registration Statement
on Form S-1 (File No. 333-118827) dated December 8, 2004).
146
Exhibit No.
10.37+
10.38+
10.39+
10.40+
10.41+
10.42+
10.43+
10.44+
10.45+
10.46+
10.47+
10.48+
10.49+
10.50+
10.51+
Description of Document
Form of Nonqualified Stock Option Agreement under the Company’s 2004 Equity Award Plan
(incorporated by reference from Exhibit 10.2 to the Company’s Quarterly Report on Form 10-Q
(File No. 001-32373) for the quarter ended June 30, 2009 and filed August 7, 2009).
Form of Nonqualified Stock Option Agreement under the 2004 Equity Award Plan (incorporated
by reference from Exhibit 10.51 to the Company’s Annual Report on Form 10-K (File No.
001-32373) for the year ended December 31, 2010 and filed on March 1, 2011).
Las Vegas Sands Corp. Amended and Restated Executive Cash Incentive Plan (incorporated by
reference from Exhibit 10.1 to the Company’s Quarterly Report on Form 10-Q (File No.
001-32373) for the quarter ended March 31, 2013 and filed on May 10, 2013).
Form of Director Restricted Stock Units Award Agreement under the Company's 2004 Equity
Award Plan (incorporated by reference from Exhibit 10.4 to the Company's Quarterly Report on
Form 10-Q (File No. 001-32373) for the quarter ended June 30, 2014) and filed on August 7,
2014.
Form of Restricted Stock Award Agreement (incorporated by reference from Exhibit 10.1 to the
Company’s Current Report on Form 8-K (File No. 001-32373) filed on February 9, 2007).
Employment Agreement, dated as of November 18, 2004, by and among Las Vegas Sands Corp.,
Las Vegas Sands, Inc. and Sheldon G. Adelson (incorporated by reference from Exhibit 10.36 to
the Company’s Amendment No. 2 to Registration Statement on Form S-1 (File No. 333-118827)
dated November 22, 2004).
Amendment No. 1 to Employment Agreement, dated as of December 31, 2008, by and among Las
Vegas Sands Corp., Las Vegas Sands, LLC (f/k/a Las Vegas Sands, Inc.) and Sheldon G. Adelson
(incorporated by reference from Exhibit 10.35 to the Company’s Annual Report on Form 10-K
(File No. 001-32373) for the year ended December 31, 2008 and filed on March 2, 2009).
Employment Agreement, dated as of November 13, 2010, among Las Vegas Sands Corp., Las
Vegas Sands, LLC and Michael A. Leven (incorporated by reference from Exhibit 10.57 to the
Company’s Annual Report on Form 10-K (File No. 001-32373) for year ended December 31,
2010 and filed on March 1, 2011).
Terms of Continued Employment, dated June 7, 2012, among Las Vegas Sands Corp., Las Vegas
Sands, LLC and Michael A. Leven (incorporated by reference from Exhibit 10.1 to the
Company’s Quarterly Report on Form 10-Q (File No. 001-32373) for the quarter ended June 30,
2012 and filed on August 9, 2012).
Amended Terms of Continued Employment, dated April 24, 2013, among Las Vegas Sands Corp.,
Las Vegas Sands, LLC and Michael A. Leven (incorporated by reference from Exhibit 10.2 to the
Company’s Quarterly Report on Form 10-Q (File No. 001-32373) for the quarter ended March 31,
2013 and filed on May 10, 2013).
Employment Agreement, dated as of December 1, 2008 between Las Vegas Sands Corp. and
Kenneth J. Kay (incorporated by reference from Exhibit 10.36 to the Company’s Annual Report
on Form 10-K (File No. 001-32373) for the year ended December 31, 2008 and filed on March 2,
2009).
Letter Agreement, dated January 18, 2010, between Las Vegas Sands Corp. and Kenneth J. Kay
(incorporated by reference from Exhibit 10.33 to the Company’s Annual Report on Form 10-K
(File No. 001-32373) for the year ended December 31, 2009 and filed on March 1, 2010).
Amendment to Employment Agreement, effective December 31, 2012, between Las Vegas Sands
Corp. and Kenneth J. Kay (incorporated by reference from Exhibit 10.3 to the Company’s
Quarterly Report on Form 10-Q (File No. 001-32373) for the quarter ended March 31, 2013 and
filed on May 10, 2013).
Separation Agreement and General Release, dated as of July 10, 2013, between Kenneth J. Kay
and Las Vegas Sands Corp. (including as Attachment A thereto, the Consultancy Agreement,
entered into as of July 10, 2013, between Las Vegas Sands Corp. and Kenneth J. Kay)
(incorporated by reference from Exhibit 10.1 to the Company’s Quarterly Report on Form 10-Q
(File No. 001-32373) for the quarter ended June 30, 2013 and filed on August 9, 2013).
Employment Agreement, dated as of January 11, 2011, among Las Vegas Sands Corp., Las Vegas
Sands, LLC and Robert G. Goldstein (incorporated by reference from Exhibit 10.60 to the
Company’s Annual Report on Form 10-K (File No. 001-32373) for year ended December 31,
2010 and filed on March 1, 2011).
147
Exhibit No.
10.52+
10.53+
10.54+
10.55+
10.56+
10.57+
10.58
10.59
10.60
10.61
10.62
10.63
10.64
Description of Document
Terms of Continued Employment, dated as of March 7, 2012, among Las Vegas Sands Corp., Las
Vegas Sands, LLC and Robert G. Goldstein (incorporated by reference from Exhibit 10.1 to the
Company’s Quarterly Report on Form 10-Q (File No. 001-32373) for the quarter ended March 31,
2012 and filed on May 10, 2012).
Employment Agreement, dated as of April 1 2012, between Las Vegas Sands Corp. and Chris J.
Cahill (incorporated by reference from Exhibit 10.4 to the Company’s Quarterly Report on
Form 10-Q (File No. 001-32373) for the quarter ended March 31, 2013 and filed on May 10,
2013).
Amendment to Employment Agreement, effective December 31, 2012, between Las Vegas Sands
Corp. and Chris J. Cahill (incorporated by reference from Exhibit 10.5 to the Company’s
Quarterly Report on Form 10-Q (File No. 001-32373) for the quarter ended March 31, 2013 and
filed on May 10, 2013).
Amendment to Employment Agreement, dated as of March 27, 2013, between Las Vegas Sands
Corp. and Chris J. Cahill (incorporated by reference from Exhibit 10.6 to the Company’s
Quarterly Report on Form 10-Q (File No. 001-32373) for the quarter ended March 31, 2013 and
filed on May 10, 2013).
Employment Letter, dated April 15, 2011, from Las Vegas Sands Corp. to John Caparella
(incorporated by reference from Exhibit 10.7 to the Company’s Quarterly Report on Form 10-Q
(File No. 001-32373) for the quarter ended March 31, 2013 and filed on May 10, 2013).
Amendment to Employment Letter, effective December 31, 2012, between Las Vegas Sands Corp.
and John Caparella (incorporated by reference from Exhibit 10.8 to the Company’s Quarterly
Report on Form 10-Q (File No. 001-32373) for the quarter ended March 31, 2013 and filed on
May 10, 2013).
Settlement Agreement, date as of June 24, 2011, by and among Venetian Casino Resort, LLC,
Phase II Mall Holding, LLC, GGP Limited Partnership, The Shoppes at the Palazzo, LLC (f/k/a
Phase II Mall Subsidiary, LLC) and Grand Canal Shops II, LLC (incorporated by reference from
Exhibit 10.63 to the Company’s Annual Report on Form 10-K (File No. 001-32373) for the year
ended December 31, 2011 and filed on February 28, 2012).
Purchase and Sale Agreement, dated April 12, 2004, by and among Grand Canal Shops Mall
Subsidiary, LLC, Grand Canal Shops Mall MM Subsidiary, Inc. and GGP Limited Partnership
(incorporated by reference from Exhibit 10.1 to Las Vegas Sands, Inc.’s Current Report on
Form 8-K (File No. 333-42147) filed on April 16, 2004).
Agreement, made as of April 12, 2004, by and between Lido Casino Resort, LLC and GGP
Limited Partnership (incorporated by reference from Exhibit 10.2 to Las Vegas Sands, Inc.’s
Current Report on Form 8-K (File No. 333-42147) filed on April 16, 2004).
Assignment and Assumption of Agreement and First Amendment to Agreement, dated
September 30, 2004, made by Lido Casino Resort, LLC, as assignor, to Phase II Mall Holding,
LLC, as assignee, and to GGP Limited Partnership, as buyer (incorporated by reference from
Exhibit 10.60 to the Company’s Amendment No. 1 to Registration Statement on Form S- 1 (File
No. 333-118827) dated October 25, 2004).
Second Amendment, dated as of January 31, 2008, to Agreement dated as of April 12, 2004 and
amended as of September 30, 2004, by and among Venetian Casino Resort, LLC, as successor-by-
merger to Lido Casino Resort, LLC, Phase II Mall Holding, LLC, as successor-in-interest to Lido
Casino Resort, LLC, and GGP Limited Partnership (incorporated by reference from Exhibit 10.2
to the Company’s Quarterly Report on Form 10-Q (File No. 001-32373) for the quarter ended
March 31, 2008 and filed on May 9, 2008).
Second Amended and Restated Registration Rights Agreement, dated as of November 14, 2008,
by and among Las Vegas Sands Corp., Dr. Miriam Adelson and the other Adelson Holders (as
defined therein) that are party to the agreement from time to time (incorporated by reference from
Exhibit 10.2 to the Company’s Current Report on Form 8-K (File No. 001-32373) filed on
November 14, 2008).
Investor Rights Agreement, dated as of September 30, 2008, by and between Las Vegas Sands
Corp. and the Investor named therein (incorporated by reference from Exhibit 10.3 to the
Company’s Quarterly Report on Form 10-Q (File No. 001-32373) for the quarter ended
September 30, 2008 and filed on November 10, 2008).
148
Exhibit No.
10.65
10.66
10.67
10.68
10.69
10.70
10.71
10.72
10.73
10.74
10.75
10.76
10.77
10.78+
Description of Document
Agreement, dated as of July 8, 2004, by and between Sheldon G. Adelson and Las Vegas Sands,
Inc. (incorporated by reference from Exhibit 10.47 to the Company’s Registration Statement on
Form S-1 (File No. 333-118827) dated September 3, 2004).
Venetian Hotel Service Agreement, dated as of June 28, 2001, by and between Venetian Casino
Resort, LLC and Interface Group-Nevada, Inc. d/b/a Sands Expo and Convention Center
(incorporated by reference from Exhibit 10.49 to the Company’s Amendment No. 2 to
Registration Statement on Form S-1 (File No. 333-118827) dated November 22, 2004).
First Amendment to Venetian Hotel Service Agreement, dated as of June 28, 2004, by and
between Venetian Casino Resort, LLC and Interface Group-Nevada, Inc. d/b/a Sands Expo and
Convention Center (incorporated by reference from Exhibit 10.50 to the Company’s Registration
Statement on Form S-1 (File No. 333-118827) dated September 3, 2004).
Tax Indemnification Agreement, dated as of December 17, 2004, by and among Las Vegas Sands
Corp., Las Vegas Sands, Inc. and the stockholders named therein (incorporated by reference from
Exhibit 10.56 to the Company’s Current Report on Form 8-K (File No. 001-32373) filed on April
4, 2005).
Aircraft Time Sharing Agreement, dated as of November 6, 2009 and effective as of January 1,
2009, between Las Vegas Sands Corp. and Interface Operations, LLC (incorporated by reference
from Exhibit 10.2 to the Company’s Quarterly Report on Form 10-Q for the quarter ended
September 30, 2009 and filed on November 9, 2009).
Aircraft Time Sharing Agreement, dated as of November 6, 2009 and effective as of January 1,
2009, between Interface Operations, LLC and Las Vegas Sands Corp. (incorporated by reference
from Exhibit 10.3 to the Company’s Quarterly Report on Form 10-Q (File No. 001-32373) for the
quarter ended September 30, 2009 and filed on November 9, 2009).
Aircraft Time Sharing Agreement, dated as of November 6, 2009 and effective as of January 1,
2009, between Las Vegas Sands Corp. and Interface Operations, LLC (incorporated by reference
from Exhibit 10.4 to the Company’s Quarterly Report on Form 10-Q (File No. 001-32373) for the
quarter ended September 30, 2009 and filed on November 9, 2009).
Aircraft Time Sharing Agreement, dated as of November 6, 2009 and effective as of January 1,
2009, between Interface Operations, LLC and Las Vegas Sands Corp. (incorporated by reference
from Exhibit 10.5 to the Company’s Quarterly Report on Form 10-Q (File No. 001-32373) for the
quarter ended September 30, 2009 and filed on November 9, 2009).
Aircraft Time Sharing Agreement, dated as of November 6, 2009 and effective as of January 1,
2009, between Interface Operations Bermuda, LTD and Las Vegas Sands Corp. (incorporated by
reference from Exhibit 10.6 to the Company’s Quarterly Report on Form 10-Q (File No.
001-32373) for the quarter ended September 30, 2009 and filed on November 9, 2009).
Aircraft Time Share Agreement, dated as of May 23, 2007, by and between Interface Operations
LLC and Las Vegas Sands Corp. (incorporated by reference from Exhibit 10.2 to the Company’s
Quarterly Report on Form 10-Q (File No. 001-32373) for the quarter ended June 30, 2007 and
filed on August 9, 2007).
Aircraft Time Sharing Agreement, dated as of January 1, 2005, by and between Interface
Operations LLC and Las Vegas Sands Corp. (incorporated by reference from Exhibit 10.3 to the
Company’s Quarterly Report on Form 10-Q (File No. 001-32373) for the quarter ended
September 30, 2005 and filed November 14, 2005).
Aircraft Time Sharing Agreement, dated as of June 18, 2004, by and between Interface Operations
LLC and Las Vegas Sands, Inc. (incorporated by reference from Exhibit 10.48 to the Company’s
Amendment No. 1 to Registration Statement on Form S-1 (File No. 333-118827) dated
October 25, 2004).
Aircraft Time Sharing Agreement dated as of April 14, 2011, between Las Vegas Sands Corp. and
Interface Operations, LLC (incorporated by reference from Exhibit 10.1 to the Company’s
Quarterly Report on Form 10-Q (File No. 001-32373) for the quarter ended June 30, 2011).
Form of Restricted Stock Award Agreement under the 2004 Equity Award Plan (incorporated by
reference from Exhibit 10.82 to the Company’s Annual Report on Form 10-K (File No.
001-32373) for year ended December 31, 2010 and filed on March 1, 2011).
149
Exhibit No.
10.79+
10.80+
10.81*+
10.82+
10.83+
10.84+
10.85+
10.86+
10.87+
21.1*
23.1*
23.2*
31.1*
31.2*
32.1*
32.2*
101.CAL
101.DEF
101.INS
101.LAB
101.PRE
101.SCH
Description of Document
Form of Restricted Stock Award agreement under the 2004 Equity Award Plan (incorporated by
reference from Exhibit 10.86 to the Company’s Annual Report on Form 10-K (File No.
001-32373) for the year ended December 31, 2011 and filed on February 28, 2012).
Form of Restricted Stock Units Award agreement under the 2004 Equity Award Plan (incorporated
by reference from Exhibit 10.87 to the Company’s Annual Report on Form 10-K (File No.
001-32373) for the year ended December 31, 2011 and filed on February 28, 2012).
Terms of Continued Employment, dated December 9, 2014, among Las Vegas Sands Corp., Las
Vegas Sands, LLC and Robert G. Goldstein.
Las Vegas Sands Corp. Non-Employee Director Deferred Compensation Plan (incorporated by
reference from Exhibit 10.88 to the Company’s Annual Report on Form 10-K (File No.
001-32373) for the year ended December 31, 2011 and filed on February 28, 2012).
Letter of Appointment for Executive, dated August 4, 2010, between Venetian Macau Limited and
Edward M. Tracy (incorporated by reference from Exhibit 10.2 to the Company's Quarterly
Report on Form 10-Q (File No. 001-32373) for the quarter ended March 31, 2014) and filed on
May 7, 2014.
Contract Renewal, dated May 10, 2012, between Venetian Macau Limited and Edward Matthew
Tracy (incorporated by reference from Exhibit 10.2.1 to the Company's Quarterly Report on Form
10-Q (File No. 001-32373) for the quarter ended March 31, 2014) and filed on May 7, 2014.
Contract Renewal, dated May 1, 2013, between Venetian Macau Limited and Edward Matthew
Tracy (incorporated by reference from Exhibit 10.2.2 to the Company's Quarterly Report on Form
10-Q (File No. 001-32373) for the quarter ended March 31, 2014) and filed on May 7, 2014.
Form of Director Restricted Stock Units Award Agreement (with deferred settlement) under the
2004 Equity Award Plan (incorporated by reference from Exhibit 10.5 to the Company's Quarterly
Report on Form 10-Q (File No. 001-32373) for the quarter ended June 30, 2014) and filed on
August 7, 2014.
Form of Restricted Stock Units Award Agreement under the 2004 Equity Award Plan
(incorporated by reference from Exhibit 10.6 to the Company's Quarterly Report on Form 10-Q
(File No. 001-32373) for the quarter ended June 30, 2014) and filed on August 7, 2014.
Subsidiaries of Las Vegas Sands Corp.
Consent of Deloitte & Touche LLP.
Consent of PricewaterhouseCoopers LLP.
Certification of the Chief Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act of
2002.
Certification of the Principal Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act
of 2002.
Certification of Chief Executive Officer of Las Vegas Sands Corp. pursuant to 18 U.S.C.
Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
Certification of Principal Financial Officer of Las Vegas Sands Corp. pursuant to 18 U.S.C.
Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
XBRL Taxonomy Extension Calculation Linkbase Document
XBRL Taxonomy Extension Definition Linkbase Document
XBRL Instance Document
XBRL Taxonomy Extension Label Linkbase Document
XBRL Taxonomy Extension Presentation Linkbase Document
XBRL Taxonomy Extension Schema Document
_________________________
Filed herewith.
*
Confidential treatment has been requested and granted with respect to portions of this exhibit, and such
†
confidential portions have been deleted and replaced with “**” and filed separately with the Securities and
Exchange Commission pursuant to Rule 406 under the Securities Act of 1933.
Denotes a management contract or compensatory plan or arrangement.
+
150
Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the registrant has
duly caused this Annual Report on Form 10-K to be signed on its behalf by the undersigned thereunto duly authorized.
SIGNATURES
February 27, 2015
LAS VEGAS SANDS CORP.
/S/ SHELDON G. ADELSON
Sheldon G. Adelson,
Chairman of the Board and
Chief Executive Officer
Pursuant to the requirements of the Securities Exchange Act of 1934, this Annual Report on Form 10-K has been
signed below by the following persons on behalf of the registrant and in the capacities and on the dates indicated.
Signature
Title
Date
/S/ SHELDON G. ADELSON
Sheldon G. Adelson
/S/ ROBERT G. GOLDSTEIN
Robert G. Goldstein
/S/ JASON N. ADER
Jason N. Ader
/S/ IRWIN CHAFETZ
Irwin Chafetz
/S/ MICHELINE CHAU
Micheline Chau
/S/ CHARLES D. FORMAN
Charles D. Forman
/S/ STEVEN L. GERARD
Steven L. Gerard
/S/ GEORGE JAMIESON
George Jamieson
/S/ CHARLES A. KOPPELMAN
Charles A. Koppelman
/S/ MICHAEL A. LEVEN
Michael A. Leven
/S/ DAVID F. LEVI
David. F. Levi
/S/ MICHAEL A. QUARTIERI
Michael A. Quartieri
Chairman of the Board, Chief
February 27, 2015
Executive Officer and Director
President, Chief Operating Officer
February 27, 2015
and Director
Director
Director
Director
Director
Director
Director
Director
Director
Director
February 27, 2015
February 27, 2015
February 27, 2015
February 27, 2015
February 27, 2015
February 27, 2015
February 27, 2015
February 27, 2015
February 27, 2015
Chief Accounting Officer
February 27, 2015
(Principal Financial Officer)
151
LAS VEGAS SANDS CORP.
CERTIFICATIONS
Exhibit 31.1
I, Sheldon G. Adelson, certify that:
1. I have reviewed this annual report on Form 10-K of Las Vegas Sands Corp.;
2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material
fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading
with respect to the period covered by this report;
3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present
in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods
presented in this report;
4. The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and
procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined
in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
(a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed
under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made
known to us by others within those entities, particularly during the period in which this report is being prepared;
(b) Designed such internal control over financial reporting, or caused such internal control over financial reporting
to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the
preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
(c) Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our
conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report
based on such evaluation; and
(d) Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during
the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially
affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
5. The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over
financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing
the equivalent functions):
(a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial
reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial
information; and
(b) Any fraud, whether or not material, that involves management or other employees who have a significant role in
the registrant’s internal control over financial reporting.
Date: February 27, 2015
By:
/s/ SHELDON G. ADELSON
Name: Sheldon G. Adelson
Title: Chief Executive Officer
LAS VEGAS SANDS CORP.
CERTIFICATIONS
Exhibit 31.2
I, Michael A. Quartieri, certify that:
1. I have reviewed this annual report on Form 10-K of Las Vegas Sands Corp.;
2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material
fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading
with respect to the period covered by this report;
3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present
in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods
presented in this report;
4. The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and
procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined
in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
(a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed
under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made
known to us by others within those entities, particularly during the period in which this report is being prepared;
(b) Designed such internal control over financial reporting, or caused such internal control over financial reporting
to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the
preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
(c) Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our
conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report
based on such evaluation; and
(d) Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during
the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially
affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
5. The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over
financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing
the equivalent functions):
(a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial
reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial
information; and
(b) Any fraud, whether or not material, that involves management or other employees who have a significant role in
the registrant’s internal control over financial reporting.
Date: February 27, 2015
By:
/S/ MICHAEL A. QUARTIERI
Name: Michael A. Quartieri
Title: Chief Accounting Officer
(Principal Financial Officer)
CERTIFICATION UNDER SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002
In connection with the Annual Report on Form 10-K for the year ended December 31, 2014 as filed by Las Vegas Sands Corp.
with the Securities and Exchange Commission on the date hereof (the “Report”), I certify pursuant to 18 U.S.C. Section 1350, as
adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that:
(1) The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934;
and
(2) The information contained in the Report fairly presents, in all material respects, the financial condition and results
Exhibit 32.1
of operations of Las Vegas Sands Corp.
Date: February 27, 2015
By:
/s/ SHELDON G. ADELSON
Name: Sheldon G. Adelson
Title: Chief Executive Officer
CERTIFICATION UNDER SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002
In connection with the Annual Report on Form 10-K for the year ended December 31, 2014 as filed by Las Vegas Sands Corp.
with the Securities and Exchange Commission on the date hereof (the “Report”), I certify pursuant to 18 U.S.C. Section 1350, as
adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that:
(1) The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934;
and
(2) The information contained in the Report fairly presents, in all material respects, the financial condition and results
Exhibit 32.2
of operations of Las Vegas Sands Corp.
Date: February 27, 2015
By:
/s/ MICHAEL A. QUARTIERI
Name: Michael A. Quartieri
Title: Chief Accounting Officer
(Principal Financial Officer)
BOARD OF
DIRECTORS
SENIOR CORPORATE
OFFICERS
PROPERTY
LOCATIONS
Sheldon G. Adelson
Chairman of the Board,
Chief Executive Officer & Treasurer
Sheldon G. Adelson
Chairman of the Board,
Chief Executive Officer & Treasurer
United States
Las Vegas, Nevada
Robert G. Goldstein
President & Chief Operating Officer
Robert G. Goldstein
President & Chief Operating Officer
The Venetian® Resort-Hotel-Casino
The Palazzo® Resort-Hotel-Casino
Ira H. Raphaelson
Sands® Expo and Convention Center
Executive Vice President,
Global General Counsel & Secretary
Bethlehem, Pennsylvania
Sands® Casino Resort Bethlehem
Jason N. Ader
Chief Executive Officer,
Ader Investment Management, LLC
Irwin Chafetz
Manager, The Interface Group, LLC
Micheline Chau
Retired President, Chief Operating Officer &
Chief Financial Officer, Lucasfilms Ltd.
Charles D. Forman
Retired Chairman & Chief Executive Officer,
Centric Events Group, LLC
Steven L. Gerard
Chairman & Chief Executive Officer,
CBIZ, Inc.
George Jamieson
Retired Partner, PricewaterhouseCoopers, LLP
Charles A. Koppelman
Chairman and Chief Executive Officer,
CAK Entertainment, Inc.
Michael A. Leven
Chairman & Chief Executive Officer,
Georgia Aquarium
David F. Levi
Dean & Professor of Law, Duke Law School
Macao (SAR), China
Sands® Macao
The Venetian® Macao Resort Hotel
Four Seasons Hotel Macao, Cotai Strip
The Plaza Macao, Cotai Strip
Sands Cotai Central®, Cotai Strip
Sheraton® Macao Hotel Cotai Central(1)
Conrad® Macao, Cotai Central(1)
Holiday Inn® Macao Cotai Central(1)
Singapore
Marina Bay Sands®
(1)SHERATON, CONRAD and HOLIDAY
INN are registered trademarks of their respective
owners and are used under license.
ANNUAL REPORTS
Copies of this Annual Report and the
Company’s Annual Report on Form 10-K
may be obtained by writing:
Las Vegas Sands Corp.
c/o Investor Relations
3355 Las Vegas Boulevard South
Las Vegas, Nevada 89109
STOCK TRANSFER
INFORMATION
American Stock Transfer
& Trust Company
59 Maiden Lane
New York, New York 10038
TRADING SYMBOL
Traded on the New York Stock
Exchange under the symbol: LVS
CERTIFICATIONS
Las Vegas Sands Corp. has included as exhibits to its Annual Report on Form 10-K, filed with the Securities and Exchange Commission,
certifications by the Company’s Chief Executive Officer and Chief Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
Las Vegas Sands Corp. has timely delivered the most recent certification required by Section 303A.12(a) of the New York Stock Exchange Listed
Company Manual.
THE VENETIAN MACAO
August 2007
FOUR SEASONS HOTEL
& THE PLAZA MACAO
August 2008
SANDS BETHLEHEM
May 2009
SANDS COTAI CENTRAL
April 2012
THE PARISIAN MACAO
Opening 2016
3355 LAS VEGAS BOULEVARD SOUTH, LAS VEGAS, NEVADA 89109 | 702.414.1000 | SANDS.COM