TAX ALLOCATION AGREEMENT

(i)

“Issuer Group” means Issuer together with the Issuer Subsidiaries. “Issuer Subsidiaries” means the Issuer Corporate Subsidiaries and the Issuer Disregarded Entities. “Issuer Corporate Subsidiaries” means Stratosphere Corporation, American Casino & Entertainment Properties Finance Corp. and any other direct and indirect subsidiaries of Issuer which are corporations eligible to be

(ii)

“Consolidated Returns” mean all Consolidated Federal Returns and all state income or franchise tax returns filed by Parent on a consolidated or combined basis with the Issuer Group (“Consolidated State Returns”).

(iii)

“Federal Income Taxes” means any income tax imposed under the Code including, without limitation, the corporate income tax, the minimum tax imposed on corporations, and the personal holding company tax.

(iv)

“State Income Taxes” means any income or franchise tax imposed under the tax law of any state (or political subdivision thereof) including, without limitation, corporate income taxes and minimum taxes.

(v)

“Net Operating Loss” means the amount of any net operating loss as defined in the Code or under the tax law of any state.

(vi)

“Net Capital Loss” means the amount of any net capital loss as defined in the Code or under the tax law of any state.

(vii)

“Credit” means the amount of any tax credit allowed under the Code or under the tax law of any state including, without limitation, investment tax credits and foreign tax credits.

(viii)

The “Regulations” means the regulations and proposed regulations issued by the Secretary of the Treasury interpreting the Code.

(ix)

The “Consolidated Group” means the affiliated group (as defined in the Code) of which Parent (or its successor) is the common parent, for so long as such affiliated group files a Consolidated Return.

(x)

“Tax Benefits” as to any entity (or group of entities) means the Net Operating Loss, Net Capital Loss, and Credits generated by or available to such entity (or group of entities) and any carryforwards or carrybacks thereof.

(xi)

“Final Determination” shall mean the final resolution of liability for any Tax for a taxable period, (i) by IRS Form 870 or 870-AD (or any successor form thereto), on the date of the final acceptance by or on behalf of a party thereto, or by a comparable form under the laws of another jurisdiction; except that a Form 870 or 870-AD or comparable form that reserves (whether by its terms or by operation of law) the right of the taxpayer to file a claim for refund and/or the right of taxing authority to assert a further deficiency shall not constitute a Final Determination; (ii) by a decision, judgment, decree, or other order by a court of competent jurisdiction, which has become final and unappealable; (iii) by a closing agreement or accepted offer in compromise under Section 7121 or 7122 of the Code, or comparable agreement under the laws of another jurisdiction; (iv) by any allowance of a refund or credit in respect of an overpayment of Tax, but only after the expiration of all periods during which such refund may be recovered (including by way of offset) by the Tax imposing jurisdiction; or (v) by any other final disposition, including by reason of the expiration of the applicable statute of limitations or by mutual agreement of the parties.

(xii)

“Indenture Trustee” means Wilmington Trust Company, or any replacement or successor trustee under that certain indenture dated January 29, 2004 with respect to the Debt.

(xiii)

“Debt” means (a) 7.85% Senior Secured Notes due 2012 of the Issuer, and (b) any substantially similar notes of the Issuer issued pursuant to an exchange offer as provided for in the terms of such notes.

(a)

Issuer hereby agrees and consents (i) to cause each Issuer Corporate Subsidiary to join with the Consolidated Group in the filing of Consolidated Returns with respect to any fiscal year in which Parent elects to file such returns, (ii) to furnish to Parent, and cause each Issuer Subsidiary to furnish to Parent, all information relating to members of the Issuer Group as may be necessary or appropriate for the preparation of Consolidated Returns, (iii) to cause each Issuer Corporate Subsidiary to execute and deliver to Parent all consents, directors’ resolutions and other documentation which Parent may reasonably require to evidence Parent’s authority to file Consolidated Returns, and (iv) to cause each Issuer Corporate Subsidiary to maintain the same fiscal year as Parent for all periods in which Parent and Issuer are members of an affiliated group (as defined in the Code).

(b)

Parent hereby consents to join with the Consolidated Group in the filing of Consolidated Returns; provided, however, that Parent is not precluded from taking any action which would require Parent to discontinue the filing of Consolidated Returns including, without limitation, a sale or other disposition of all or a portion of its stock ownership in Issuer and/or the filing of an application with the Commissioner of Internal Revenue, or other appropriate authorities, including tax authorities of any state (or political subdivision thereof) (“Taxing Authorities”) on behalf of the

Consolidated Group, requesting permission to discontinue the filing of Consolidated Returns.

(c)

Parent shall prepare and file Consolidated Returns on behalf of the Consolidated Group and shall make all decisions regarding any elections or other matters relating to the preparation and filing of Consolidated Returns; provided, however, that in making elections and other decisions with respect to members of the Issuer Group, Parent shall consult with the Issuer Group and in good faith consider their recommendations regarding the possibility of making such elections.