The Board of Directors (the “Board”) of Station Casinos, Inc. (the
“Company”) represents the stockholders’ interest in perpetuating a
successful business, including optimizing long-term financial returns.
The Board is responsible for determining that the Company is managed in
such a way to ensure this result. This is an active, not a passive,
responsibility. The Board has the responsibility to ensure that in good
times, as well as difficult ones, that management is capably executing its
- Selection and Composition of the Board
- Board Membership Criteria
The Governance & Compensation Committee is responsible for reviewing with the Board, on a semi-annual basis, based on observations, suggestions and comments of Board members and investigating and making recommendations to the Board concerning any allegations of
improper conduct on the part of any Director.
- Selection and Orientation of New Directors
The Board, taking into consideration the recommendations of the Governance & Compensation Committee, shall be responsible for recommending a slate of director candidates for the Board to nominate to stand for election (together with any individuals designated by third
parties who the Company is legally required, by contract or otherwise, to nominate) at the Company’s annual meeting of stockholders.
The Governance & Compensation Committee will seek out Board members who possess the highest personal values, judgment and integrity, professional skills and experience in dealing with complex problems that are complementary to the background and experience represented on the Board and that meet the needs of the Company, have demonstrated the ability to act independently and be willing to represent the interests of all
shareholders and not just those of a particular philosophy or constituency, and are willing and able to devote sufficient time to fulfill his or her responsibilities to the Company and its shareholders.
The Governance & Compensation Committee will establish and maintain a comprehensive orientation program for all new directors and a continuing education program for all directors.
- Board Leadership
- Selection of Chairman
At its annual meeting the Board shall elect, from among its members, a chairman who may serve as the chief executive officer of the Company and who shall preside at meetings of the Board and may preside at meetings of the stockholders.
- Lead Director
If the Chairman of the Board is an employee of the Company, the Board shall have a Director selected by the independent Directors who will assume the responsibility of chairing the regularly scheduled executive session meetings of independent Directors and other responsibilities which the independent Directors as a whole might designate from time to time.
The same person may serve as the Chairman of a standing committee and the “lead” Director.
- Other Officers
The Board may also elect such other officers of the Board and for such term as it may, from time to time, determine advisable.
- Board Composition and Performance
- Size of the Board
Except as otherwise fixed by resolution of the Board pursuant to the articles of incorporation relating to the authorization of the Board to provide by resolution for the issuance of Preferred Stock and to determine the rights of the holders of such Preferred Stock to elect directors, the authorized number of directors which shall constitute the whole board
shall be not less than three (3) nor more than fifteen (15) subject to the foregoing limitations, the exact authorized number of directors shall be fixed (and increased or decreased) from time to time by resolution of the Board.
- Mix of Management and Independent Directors
The Board shall be comprised of a majority of directors who qualify as
“independent” Directors under the listing standards of the New York
Stock Exchange (the “NYSE”), under applicable law or under any rule or
regulation of any other regulatory body or self-regulatory body applicable
to the Company.
- Board Definition of What Constitutes Independence for Directors
For purposes of defining an “independent” Director, the Board will
comply with the listing standards of the NYSE or other law, rule or
regulation of any other regulatory body or self-regulatory body applicable
to the Company. The Board, in consultation with the Governance &
Compensation Committee, will review annually the relationships that each
Director has with the Company (either directly or as a partner, stockholder
or officer of an organization that has a relationship with the Company).
Following such review, only those Directors who the Board affirmatively
determines have no relationship which would interfere with the exercise of
independent judgment in carrying out their responsibilities will be
considered independent Directors, subject to the applicable rules of the
NYSE. The Governance & Compensation Committee shall periodically
review the compensation arrangements and other business relationships
between Directors and the Company, including the Company’s charitable
and political contributions, in order to monitor the continued independence
of Directors deemed independent. In addition, a member of the Audit
Committee may not receive any compensation except for compensation
for service on the Board or a Committee.
- A director who is an employee, or whose immediate family member is
an executive officer, of the Company is not independent until three years
after the end of such employment relationship.
- A director who receives, or whose immediate family member receives,
more than $100,000 per year in direct compensation from the Company,
other than director and committee fees and pension or other forms of
deferred compensation for prior service (provided such compensation is
not contingent in any way on continued service), is not independent until
three years after he or she ceases to receive more than $100,000 per year
in such compensation.
- A director who is affiliated with or employed by, or whose immediate
family member is affiliated with or employed in a professional capacity
by, a present or former internal or external auditor of the Company is not
“independent” until three years after the end of the affiliation or the
employment or auditing relationship.
- A director who is employed, or whose immediate family member is
employed, as an executive officer of another company where any of the
Company’s present executives serve on that company’s compensation
committee is not “independent” until three years after the end of such
service or the employment relationship.
- A director who is an executive officer or an employee, or whose
immediate family member is an executive officer, of a company that
makes payments to, or receives payments from, the Company for property
or services in an amount which, in any single fiscal year, exceeds the
greater of $1 million, or 2% of such other company’s consolidated gross
revenues, is not “independent” until three years after falling below such
- Directors Who Change Their Present Job Responsibility
It is the sense of the Board that when a Director’s principal occupation or
business association changes substantially from the position he or she held
when originally invited to join the Board, the Director shall tender a letter
of resignation to the Board. It is not the sense of the Board that in every
instance Directors who change the position they held when they came on
the Board should necessarily leave. There should, however, be an
opportunity for the Board, via the Governance & Compensation
Committee, to review the continued appropriateness of the Board
membership under these circumstances.
Independent Directors are encouraged to limit the number of other boards
(excluding non-profit) on which they serve, taking into account potential
board attendance, participation and effectiveness on these boards.
Independent Directors should also advise the Chairman of the Board and
the Chairman of the Governance & Compensation Committee in advance
of accepting an invitation to serve on another board.
Members of the Audit Committee shall not serve on audit committees of
more than three other public companies.
- Term Limits
The Board does not believe it should establish term limits. While term
limits could help ensure that there are fresh ideas and viewpoints available
to the Board, they hold the disadvantage of losing the contribution of
Directors who have been able to develop, over a period of time, increasing
insight into the Company and its operations and, therefore, provide an
increasing contribution to the Board as a whole. As an alternative to term
limits, the Governance & Compensation Committee, in conjunction with
the Chief Executive Officer, will formally review each Director’s
continuation on the Board every three years. This will also allow each
Director the opportunity to conveniently confirm his/her desire to continue
as a member of the Board.
- Retirement Age
It is the sense of the Board that Directors that there should not be a
mandatory or recommended retirement age. Rather, age should be taken
into consideration in the Governance & Compensation Committee’s semiannual
- Board Compensation
It is appropriate for the Governance & Compensation Committee to
request an impartial review of the status of Board compensation in relation
to other comparable companies. As part of a Director’s total compensation
and to create a direct linkage with corporate performance, the Board
believes that a portion of a Director’s compensation should be provided
and held in equity or rights to obtain equity of the Company.
Changes in Board compensation, if any, should come at the suggestion of
the Governance & Compensation Committee, but with full discussion and
approval by the Board.
- Executive Sessions of Independent Directors
The independent Directors of the Board will meet in executive session at
least two times per year. Executive sessions will be chaired by the Lead
Director. The format and agenda of these meetings will be set by Lead
Director after consultation with the independent Directors.
- Continuing Education
The Board will comply with the listing standards of the NYSE or other law,
rule or regulation of any other regulatory body or self-regulatory body
applicable to the Company regarding the continuing education of the
- Assessing the Board’s Performance
The Governance & Compensation Committee is responsible to perform
semi-annual evaluations based on observations, suggestions and comments
of Board members and investigate and make recommendations to the Board
concerning any allegations of improper conduct on the part of any director.
- Board’s Interaction with Institutional Investors, Press, Customers, Etc.
It is important that the Company speak to employees and outside
constituencies with a single voice, and that management serve as the primary
spokesperson. If a situation does arise in which it seems necessary for a
non-management director to speak on behalf of the Company to one of these
constituencies, the Director should consult with the Chief Executive Officer.
The basic responsibility of the Directors is to exercise their business
judgment to act in what they reasonably believe to be in the best interests of
the Company and its stockholders. The Directors shall be entitled to have
the Company purchase reasonable directors’ and officers’ liability insurance
on their behalf, to the benefits of indemnification to the fullest extent
permitted by law and the Company’s charter and bylaws and any
indemnification agreements, and to exculpation as provided by state law and
the Company’s charter.
- Board Relationship to Senior Management
- Regular Attendance of Non-Directors at Board Meetings
The Board welcomes the regular attendance at each Board meeting of non-
Board members who are in the most senior management positions of the
Company and the Secretary. Should the Chairman or Chief Executive
Officer want to add additional people as attendees on a regular basis, it is
expected that this suggestion would be made to the Board for its
- Board Access to Senior Management / Advisors
All Board members shall have complete access to the Company’s
Furthermore, the Board encourages management, from time to time, to
bring managers into Board meetings who: (a) can provide additional
insight into the items being discussed because of personal involvement in
these areas, and/or (b) are managers with future potential that the senior
management believes should be given exposure to the Board.
- Meeting Procedures
- Selection of Agenda Items for Board Meetings
The Chairman or Chief Executive Officer will establish the agenda for
each Board meeting. The agenda will be coordinated with the Lead
Director. They will issue a schedule of agenda subjects to be discussed
for the ensuing year at the beginning of each year (to the degree these can
be foreseen). Each Board member is free to suggest the inclusion of
item(s) on the agenda.
- Board Materials Distributed in Advance
Information and data that is important to the Board’s understanding of the
business will be distributed in writing to the Board before the Board
meets. Management will make every attempt to see that this material is as
brief as possible while still providing the desired information.
- Board Presentations
As a general rule, presentations on specific subjects should be sent to the
Board members in advance so that Board meeting time may be conserved
and discussion time focused on questions that the Board has about the
material. The material should be sent sufficiently in advance to allow
meaningful review of the information so distributed. On those occasions
in which the subject matter is too sensitive to put on paper, the
presentation will be discussed at the meeting.
- Committee Matters
- Number, Structure and Independence of Committees
The current Board committees are the Audit Committee and the
Governance & Compensation Committee. From time to time, the Board
may desire to form a new committee.
Each committee shall have access to such outside advice as such
committee in its sole discretion deems necessary or appropriate, including,
but not limited to, attorneys, compensation consultants and/or auditors.
The Audit Committee and the Governance & Compensation Committee
shall each consist solely of independent directors.
- Assignment and Rotation of Committee Members
The Board of Directors is responsible, after consultation with the
Governance & Compensation Committee, the committee chairs and the
standing committees, for the assignment of Board members to various
It is the sense of the Board that consideration should be given to rotating
committee members periodically at about a five year interval, but the
Board does not feel that such a rotation should be mandated as a policy
since there may be reasons at a given point in time to maintain an
individual Director’s committee membership for a longer period.
- Frequency and Length of Committee Meetings
The committee chairperson, in consultation with committee members, will
determine the frequency and length of the meetings of the committee.
- Committee Agenda
The chairperson of each committee, in consultation with the appropriate
members of the committee and management, will develop the committee’s
agenda. Each committee will issue a schedule of agenda subjects to be
discussed for the ensuing year at the beginning of each year (to the degree
these can be foreseen). This forward agenda will also be shared with the
- Committee Evaluation
The Audit and Governance & Compensation committees shall each
undertake an annual performance evaluation as specified in their
Each committee shall have its own charter as required by applicable SEC
rules and the NYSE listing standards, which will set forth the purposes,
goals and responsibilities of the committees and the qualifications for
committee membership, procedures for committee member appointment
and removal, committee structure and committee reporting to the Board.
Current versions of such committee charters shall be available on the
Company’s website and in print to any stockholder who requests a copy.
- Executive Sessions
The Audit Committee shall meet, in separate executive sessions, with each
of management, internal auditors and the independent auditors as decided
upon by the Audit Committee.
- Leadership Development
- Formal Evaluation of the Chief Executive Officer
The Governance & Compensation Committee shall review and approve
corporate goals and objectives relevant to the compensation of the CEO
and the other executive officers, evaluate the performance of the CEO and
the other executive officers in light of these goals and objectives and set
the compensation of the CEO and the other executive officers based on
- Succession Planning
The Governance & Compensation Committee shall develop plans and
guidelines for CEO succession.
These Corporate Governance Guidelines are subject to future amendments as the Board
may find necessary or appropriate for the Company. The Governance & Compensation
Committee shall review these Corporate Governance Guidelines on at least an annual basis, and
report to the Board with any recommendations it may have in connection therewith. Such review
shall be referred to in the Company’s annual proxy statement.