Edgar Filing: BOYD GAMING CORP

Amendment No 1 to Form S-4

As filed with the Securities and Exchange Commission on March 29, 2004

Registration No. 333-113440

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

AMENDMENT NO. 1

FORM S-4

REGISTRATION STATEMENT

UNDER

THE SECURITIES ACT OF 1933

Boyd Gaming Corporation

(Exact name of registrant as specified in its charter)

Nevada

7990

88-0242733

(State or other jurisdiction of

incorporation or organization)

(Primary Standard Industrial

Classification Code Number)

(I.R.S. Employer

Identification Number)

2950 Industrial Road

Las Vegas, Nevada 89109

(702) 792-7200

(Address, including zip code, and telephone number, including area code, of registrant’s principal executive offices)

Brian A. Larson, Esq.

General Counsel

Boyd Gaming Corporation

2950 Industrial Road

Las Vegas, Nevada 89109

(702) 792-7200

(Name, address, including zip code, and telephone number, including area code, of agent for service)

Copies to:

Mark I. Greene, Esq.

Cravath, Swaine & Moore LLP

Worldwide Plaza

825 Eighth Avenue

New York, New York 10019

(212) 474-1000

Harlan D. Braaten

President and Chief Operating Officer

Coast Casinos, Inc.

4500 West Tropicana Avenue

Las Vegas, Nevada 89103

(702) 365-7111

Karen E. Bertero, Esq.

Gibson, Dunn & Crutcher LLP

333 South Grand Avenue

Los Angeles, California 90071

(213) 229-7000

Approximate date of commencement of proposed sale of the securities to the public: As soon as practicable after this registration statement becomes effective and upon completion of the transactions described in the enclosed prospectus.

If the securities being registered on this Form are being offered in connection with the formation of a holding company and there is compliance with general Instruction G, check the following box. ¨

If this Form is filed to register additional securities for an offering pursuant to Rule 462(b) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. ¨

If this Form is a post-effective amendment filed pursuant to Rule 462(d) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. ¨

The registrant hereby amends this Registration Statement on such date or dates as may be necessary to delay its effective date until the registrant shall file a further amendment which specifically states that this Registration Statement shall thereafter become effective in accordance with Section 8(a) of the Securities Act of 1933, or until this Registration Statement shall become effective on such date as the Commission, acting pursuant to said Section 8(a), may determine.

March 29, 2004

MERGER PROPOSED—YOUR VOTE IS VERY IMPORTANT

Boyd Gaming Corporation, its direct wholly owned subsidiary BGC, Inc. and Coast Casinos, Inc. have entered into an Agreement and Plan of Merger dated as of February 6, 2004, as amended, which is referred to in this joint proxy statement/prospectus as the “merger agreement,” pursuant to which Boyd Gaming will acquire Coast Casinos through a merger of Coast Casinos with and into BGC, Inc., which is referred to in this joint proxy statement/prospectus as the “merger.” The merger agreement is attached as Annex A to this joint proxy statement/prospectus and is incorporated into this joint proxy statement/prospectus by reference. This joint proxy statement/prospectus describes the merger agreement, the merger and the transactions related to the merger in detail and provides information concerning the annual meeting of Boyd Gaming stockholders and the annual meeting of Coast Casinos stockholders.

Except with respect to certain specified officers of Coast Casinos, at the effective time of the merger, each issued and outstanding share of Coast Casinos common stock will be converted into the right to receive $550 in cash, unless an election is made in a timely manner by the holder of the Coast Casinos common stock to receive 32.8025 shares of Boyd Gaming common stock for such share of Coast Casinos common stock. The maximum aggregate number of shares of Boyd Gaming common stock issuable in the merger to Coast Casinos stockholders, other than certain specified officers of Coast Casinos, will be approximately 1,009,194 shares (subject to the rounding mechanics in the proration provisions of the merger agreement), unless an adjustment is required in order to qualify the merger as a reorganization within the meaning of Section 368(a) of the Internal Revenue Code of 1986, as amended. The amount of stock consideration and cash consideration that each Coast Casinos stockholder, other than certain specified officers of Coast Casinos, will be entitled to receive at the effective time of the merger will have an aggregate value of at least $550 per share of Coast Casinos common stock exchanged in the merger and will be subject to adjustment and proration as described in this joint proxy statement/prospectus. The exact amount of cash consideration and stock consideration to be received in the merger in exchange for shares of Coast Casinos common stock cannot be determined until the effective time of the merger. See “The Merger Agreement—Consideration to be Received in the Merger—Adjustments to the Merger Consideration and Proration” in Chapter I of this joint proxy statement/prospectus on page 68.

The Boyd Gaming board of directors has unanimously approved the merger agreement, the merger and the issuance of shares of Boyd Gaming common stock in the merger. The Coast Casinos board of directors has unanimously adopted the merger agreement and approved the merger. The issuance of shares of Boyd Gaming common stock in the merger requires the approval of a majority of the votes cast by Boyd Gaming stockholders at the Boyd Gaming annual meeting, provided that the total vote cast must represent over 50% in interest of all Boyd Gaming securities entitled to vote on such proposal at the Boyd Gaming annual meeting. The approval of the merger agreement and the merger requires the affirmative vote of a majority of the voting power of the holders of the outstanding shares of Coast Casinos common stock. Certain Coast Casinos stockholders holding an aggregate of approximately 56% of the voting power of the outstanding shares of Coast Casinos common stock have entered into an agreement with Boyd Gaming pursuant to which they have agreed, among other things, to vote their shares of Coast Casinos common stock in favor of the approval of the merger agreement and the merger.

Boyd Gaming stockholders will vote at the Boyd Gaming annual meeting on April 30, 2004, at noon, local time, at Borgata Hotel Casino and Spa, One Borgata Way, Atlantic City, New Jersey 08401. Coast Casinos stockholders will vote at the Coast Casinos annual meeting on April 29, 2004, at 5:00 p.m., local time, in the Esplanade Room at The Orleans Hotel and Casino, 4500 West Tropicana Avenue, Las Vegas, Nevada 89103.

Before casting your vote, please take the time to review carefully this joint proxy statement/prospectus, including the section entitled “Risk Factors” in Chapter I of this joint proxy statement/prospectus beginning on page 25. Your vote is very important regardless of the number of shares you hold. We enthusiastically support this combination of our companies and join with our boards of directors in recommending that you vote “FOR” the approval of the issuance of shares of Boyd Gaming common stock in the merger, in the case of Boyd Gaming stockholders, and “FOR” the approval of the merger agreement and the merger, in the case of Coast Casinos stockholders.

LOGO

William S. Boyd

Chairman and Chief Executive Officer

Boyd Gaming Corporation

LOGO

Michael J. Gaughan

Chairman and Chief Executive Officer

Coast Casinos, Inc.

None of the Securities and Exchange Commission, the Nevada Gaming Commission, the Nevada State Gaming Control Board, the Mississippi Gaming Commission, the New Jersey Casino Control Commission, the New Jersey Division of Gaming Enforcement, the Louisiana Gaming Control Board, the Illinois Gaming Board, the Indiana Gaming Commission or any state securities regulator has approved or disapproved the securities to be issued under this joint proxy statement/prospectus or determined if this joint proxy statement/prospectus is accurate or adequate. Any representation to the contrary is a criminal offense.

This joint proxy statement/prospectus is dated March 29, 2004 and is first being mailed to Boyd Gaming stockholders on or about April 2, 2004 and to Coast Casinos stockholders on or about April 1, 2004.

LOGO

Notice of Annual Meeting of Stockholders

To be held on April 30, 2004

To the stockholders of Boyd Gaming Corporation:

Notice is hereby given that the Annual Meeting of Stockholders of Boyd Gaming Corporation, a Nevada corporation (“Boyd Gaming”), will be held at Borgata Hotel Casino and Spa, One Borgata Way, Atlantic City, New Jersey 08401, on April 30, 2004 at noon, local time, for the following purposes:

To consider and vote upon a proposal to approve the issuance of shares of Boyd Gaming common stock in connection with the merger of Coast Casinos, Inc., a Nevada corporation, with and into BGC, Inc., a Nevada corporation and a wholly owned subsidiary of Boyd Gaming. The merger agreement relating to the proposed merger is included as Annex A to this joint proxy statement/prospectus.

To elect three Class I directors of Boyd Gaming to serve until the 2007 Annual Meeting of Stockholders or until their successors are duly elected and qualified.

To ratify the appointment of Deloitte & Touche LLP as Boyd Gaming’s independent auditor for the fiscal year ending December 31, 2004.

To approve an amendment to Boyd Gaming’s 2002 Stock Incentive Plan to increase the number of shares of Boyd Gaming common stock subject to the 2002 Stock Incentive Plan from 3,000,000 shares to 7,000,000 shares.

To transact such other business as may properly come before the Boyd Gaming Annual Meeting and any adjournments or postponements thereof.

Each of the foregoing items of business is more fully described in the joint proxy statement/prospectus which is attached to and made part of this notice and which you are urged to read carefully. We cannot complete the merger described in this joint proxy statement/prospectus unless the proposal to approve the issuance of shares of Boyd Gaming common stock is approved by a majority of the votes cast by Boyd Gaming stockholders at the Boyd Gaming Annual Meeting, provided that the total vote cast must represent over 50% in interest of all Boyd Gaming securities entitled to vote on such proposal at the Boyd Gaming Annual Meeting. The other proposals require the vote specified under Chapter II—Information About the Boyd Gaming Annual Meeting and Other Proposals in this joint proxy statement/prospectus.

The Board of Directors has fixed the close of business on March 31, 2004 as the record date for determining the stockholders entitled to notice of and to vote at the Boyd Gaming Annual Meeting and any adjournments or postponements thereof. Please note that the enclosed admission ticket will be required in order to obtain admission to the Boyd Gaming Annual Meeting. Accordingly, the admission ticket should not be returned with your proxy. If your shares are held in a brokerage account, you will also need to bring a copy of your brokerage account statement (which you can obtain from your broker) reflecting your stock ownership as of March 31, 2004. Cameras, recording devices and other electronic devices will not be permitted at the Boyd Gaming Annual Meeting.

All stockholders are cordially invited to attend the Boyd Gaming Annual Meeting in person. However, whether or not you expect to attend the Boyd Gaming Annual Meeting in person, you are urged to mark, sign, date and return the enclosed proxy card as promptly as possible in the postage-prepaid envelope provided to ensure your representation and the presence of a quorum at the Boyd Gaming Annual Meeting. Alternatively, you may vote via toll-free telephone call or the Internet by following the instructions on the back of the proxy card. If you send in your proxy card or vote by telephone or the Internet and then decide to attend the Boyd Gaming Annual Meeting to vote your shares in person, you may still do so. Your proxy is revocable in accordance with the procedures set forth in this joint proxy statement/prospectus.

By Order of the Board of Directors

LOGO

William S. Boyd

Chairman and Chief Executive Officer

Boyd Gaming Corporation

Las Vegas, Nevada

March 29, 2004

LOGO

COAST CASINOS, INC.

Notice of Annual Meeting of Stockholders

To be held on April 29, 2004

To the stockholders of Coast Casinos, Inc.:

NOTICE IS HEREBY GIVEN that an annual meeting of the stockholders of Coast Casinos, Inc., a Nevada corporation (“Coast Casinos”), will be held in the Esplanade Room at The Orleans Hotel and Casino, 4500 West Tropicana Avenue, Las Vegas, Nevada 89103, on April 29, 2004, at 5:00 p.m., local time, for the following purposes:

To consider and vote upon a proposal to approve the merger agreement entered into among Boyd Gaming Corporation, a Nevada corporation (“Boyd Gaming”), BGC, Inc., a Nevada corporation and a wholly owned subsidiary of Boyd Gaming, and Coast Casinos, and to approve the merger of Coast Casinos with and into BGC, Inc. The merger agreement is included as Annex A to this joint proxy statement/prospectus.

To elect four Class II directors of Coast Casinos to serve until the earlier of the consummation of the merger or the 2007 Annual Meeting of Stockholders.

To transact such other business as may properly come before the annual meeting and any adjournments or postponements of the annual meeting.

The Coast Casinos board of directors has unanimously determined that the merger agreement and the merger are fair to, and in the best interests of, Coast Casinos and its stockholders and recommends that you vote to approve the merger agreement and the merger. The Coast Casinos board of directors also recommends that you vote to elect each of the Class II director nominees. Each of the items of business to be submitted to a vote at the Coast Casinos Annual Meeting is more fully described in this joint proxy statement/prospectus, which you are urged to read carefully.

Stockholders of record on the close of business on March 31, 2004 are entitled to notice of and to vote at the Coast Casinos Annual Meeting and any adjournments or postponements of the meeting. Stockholders are cordially invited to attend the Coast Casinos Annual Meeting in person. The proposal to approve the merger agreement and the merger will require the affirmative vote of a majority of the voting power of the holders of the outstanding shares of Coast Casinos common stock. The proposal to elect the Class II director nominees will require the vote specified under Chapter III—Information About the Coast Casinos Annual Meeting and Other Proposals in this joint proxy statement/prospectus.

Your vote is very important. To ensure that your shares are represented at the Coast Casinos Annual Meeting, please complete, date and sign the enclosed proxy card and mail it promptly in the postage-paid envelope provided, whether or not you plan to attend the Coast Casinos Annual Meeting in person. Any executed but unmarked proxy cards will be voted for approval of the merger agreement and the merger and election of the Class II director nominees. You may revoke your proxy in the manner described in this joint proxy statement/prospectus at any time before it has been voted at the Coast Casinos Annual Meeting.

Under Nevada Revised Statutes (“NRS”) Chapter 92A, any Coast Casinos stockholder who follows the procedures specified in NRS Sections 92A.300 through 92A.500, inclusive, is entitled to dissent from the merger. Annex D to this joint proxy statement/prospectus contains a copy of NRS Sections 92A.300 through 92A.500, inclusive.

By Order of the Board of Directors

LOGO

J. Tito Tiberti

Secretary

Coast Casinos, Inc.

Las Vegas, Nevada

March 29, 2004

REFERENCES TO ADDITIONAL INFORMATION

This joint proxy statement/prospectus incorporates by reference important business and financial information about Boyd Gaming and Coast Casinos documents filed with the SEC, which are available without charge from the SEC’s website at www.sec.gov. See Chapter IV—Additional Information beginning on page 147. Copies of these documents related to Boyd Gaming may also be obtained without charge from Boyd Gaming on the Internet at www.boydgaming.com, under the “Investor Relations” section, or by contacting Boyd Gaming Corporation, Attn: Robert D. Stillwell at 2950 Industrial Road, Las Vegas, Nevada 89109 or by e-mail to robstillwell@boydgaming.com. Copies of these documents relating to Coast Casinos may be obtained without charge on the Internet at www.coastcasinos.com, under the “Investors” section, or by contacting Coast Casinos, Inc., Attn: Gage Parrish at 4500 West Tropicana Avenue, Las Vegas, Nevada 89103 or by e-mail to gparrish@coastcasinos.net. If you wish to obtain any of these documents from Boyd Gaming or Coast Casinos, you should, to ensure timely delivery, make your request no later than April 19, 2004.

TABLE OF CONTENTS


		Page
INTRODUCTION		1

CHAPTER I—THE MERGER		2
Questions and Answers About the Proposals		2
Summary		7
Information About the Companies		7
Overview of the Merger and Consideration to be Received in the Merger		7
The Stockholder Meetings		8
Board Recommendations		11
The Merger		11
Interests of Coast Casinos’ Directors and Executive Officers in the Merger		17
Dividend Policies		17
Material Differences in Rights of Boyd Gaming Stockholders and Coast Casinos Stockholders		18
Dissenters’ Rights of Coast Casinos Stockholders		18
Selected Historical Financial Data of Boyd Gaming		19
Selected Historical Financial Data of Coast Casinos		21
Selected Unaudited Pro Forma Condensed Combined Financial Data		22
Comparative Per Share Information		23
Comparative Per Share Market Price and Dividend Information		24
Recent Developments Relating to Boyd Gaming		24
Recent Developments Relating to Coast Casinos		24
Risk Factors		25
Risks Relating to the Merger		25
Risks Relating to Boyd Gaming’s Operations After the Consummation of the Merger		27
Additional Risks Relating to Coast Casinos’ Operations		32
Forward-Looking Statements May Prove Inaccurate		34
The Merger		35
General		35
Background of the Merger		35
Boyd Gaming’s Considerations Relating to the Merger and the Share Issuance		39
Recommendation of the Boyd Gaming Board of Directors		41
Coast Casinos’ Considerations Relating to the Merger		41
Recommendation of the Coast Casinos Board of Directors		43
Opinion of Boyd Gaming’s Financial Advisor		43
Opinion of Coast Casinos’ Financial Advisor		48
Interests of Coast Casinos’ Directors and Executive Officers in the Merger		53
Stockholders Agreement		55
Governmental and Regulatory Matters		56
U.S. Federal Income Tax Consequences of the Merger		60
Dissenters’ Rights of Coast Casinos Stockholders		63
Plans for Coast Casinos After the Merger		65
Accounting Treatment		66
Deregistration of Coast Casinos Common Stock		66
Listing of Boyd Gaming Common Stock		66
Impact of Increased Indebtedness on Dividends		66
The Merger Agreement		67
The Merger		67


		Page
Closing and Effective Time of the Merger		67
Directors and Officers of the Surviving Corporation		67
Consideration to be Received in the Merger		67
Cancellation of Shares		69
Procedures for Exchange of Certificates; Fractional Shares		69
Representations and Warranties		71
Material Adverse Effect		72
Covenants		72
No Solicitation		74
Coast Casinos Meeting		76
Boyd Gaming Meeting		76
Access to Information; Confidentiality		76
Reasonable Efforts; Notification		76
Coast Casinos Stock Options and Benefit Plans		77
Indemnification		79
Fees and Expenses		79
Public Announcements		79
Transfer Taxes		79
Stock Exchange Listing		80
Tax Treatment		80
Stockholder Litigation		80
Boyd Gaming Board of Directors		80
Conditions to the Merger		81
Termination		83
Fee if the Merger Agreement is Terminated		83
Effect of Termination		84
Amendment		84
Extension; Waiver		84
Unaudited Pro Forma Condensed Combined Financial Statements		85
Beneficial Ownership of Boyd Gaming Common Stock		93
Ownership of More than 5% of Boyd Gaming Common Stock		93
Ownership of Boyd Gaming Management		94
Beneficial Ownership of Coast Casinos Common Stock		96
Ownership of More than 5% of Coast Casinos Common Stock		96
Ownership of Coast Casinos Management		97
Description of Boyd Gaming Capital Stock		98
Comparison of Rights of Holders of Boyd Gaming Common Stock and Coast Casinos Common Stock		99
Authorized Capital Stock		99
Number, Classification and Election of Board of Directors		99
Removal of Directors		100
Newly-Created Directorships and Vacancies		100
Quorum of Directors		100
Annual Meeting		100
Special Meetings		100
Quorum of Stockholders		101
Voting Requirements		101
Action by Written Consent		102
Rights of Preferred Stockholders		102
Business Conducted at Stockholders Meetings		102
Amendment of Articles of Incorporation		102


		Page
Amendment of By-laws		103
Dividends		103
Legal Matters		104
Experts		104
Boyd Gaming		104
Coast Casinos		104

CHAPTER II—INFORMATION ABOUT THE BOYD GAMING ANNUAL MEETING AND OTHER PROPOSALS		105
The Boyd Gaming Meeting		105
Proposals		106
PROPOSAL 1—Approval of the Issuance of Shares in the Merger		106
PROPOSAL 2—Election of Boyd Gaming Directors		107
PROPOSAL 3—Ratification of Independent Auditor		124
PROPOSAL 4—Amendment to 2002 Stock Incentive Plan		125
Stockholder Proposals		131
Other Matters		131

CHAPTER III—INFORMATION ABOUT THE COAST CASINOS ANNUAL MEETING AND OTHER PROPOSALS		132
The Coast Casinos Meeting		132
Proposals		134
PROPOSAL 1—Approval of the Merger Agreement and the Merger		134
PROPOSAL 2—Election of Coast Casinos Directors		134
Stockholder Proposals		145
Stockholder Communications		145
Other Matters		146

CHAPTER IV—ADDITIONAL INFORMATION		147

Annex A—Agreement and Plan of Merger		A-1
Annex B—Opinion of Deutsche Bank Securities Inc., Financial Advisor to Boyd Gaming		B-1
Annex C—Opinion of Banc of America Securities LLC, Financial Advisor to Coast Casinos		C-1
Annex D—Nevada Revised Statutes, Sections 92A.300 through 92A.500		D-1
Annex E—Boyd Gaming Audit Committee Charter		E-1
Annex F—Amended and Restated 2002 Stock Incentive Plan		F-1
Annex G—Coast Casinos Audit Committee Charter		G-1

iii

INTRODUCTION

This joint proxy statement/prospectus is being mailed to Boyd Gaming stockholders in connection with the Annual Meeting of Stockholders of Boyd Gaming and to Coast Casinos stockholders in connection with the Annual Meeting of Stockholders of Coast Casinos. This joint proxy statement/prospectus is organized into four chapters:

Chapter I—The Merger: Provides summary and detailed information about the merger agreement and the proposed merger, including the issuance of shares of Boyd Gaming common stock in the merger. Coast Casinos stockholders will consider and vote upon a proposal to approve the merger agreement and the merger at the Coast Casinos annual meeting. Boyd Gaming stockholders will consider and vote upon a proposal to approve the issuance of shares of Boyd Gaming common stock in the merger at the Boyd Gaming annual meeting.

Chapter II—Information About the Boyd Gaming Annual Meeting and Other Proposals: Provides information about Boyd Gaming’s annual meeting, the matters that Boyd Gaming stockholders will vote on at the annual meeting, including the issuance of shares of Boyd Gaming common stock in the merger, the election of directors, the ratification of Boyd Gaming’s independent auditor and an amendment to Boyd Gaming’s 2002 Stock Incentive Plan, and how Boyd Gaming stockholders may vote or grant a proxy and the vote required to adopt each proposal to be presented. Coast Casinos stockholders will not vote on these matters.

Chapter III—Information About the Coast Casinos Annual Meeting and Other Proposals: Provides information about Coast Casinos’ annual meeting, the matters that Coast Casinos stockholders will vote on at the annual meeting, including the approval of the merger agreement and the merger and the election of directors, and how Coast Casinos stockholders may vote or grant a proxy and the vote required to adopt each proposal to be presented. Boyd Gaming stockholders will not vote on these matters.

Chapter IV—Additional Information: Explains where Boyd Gaming stockholders and Coast Casinos stockholders can find more information about each of the companies.

You should read this joint proxy statement/prospectus carefully before you vote your shares.

CHAPTER I—THE MERGER

QUESTIONS AND ANSWERS ABOUT THE PROPOSALS

GENERAL QUESTIONS AND ANSWERS

Q:	Why is the merger and the issuance of shares of Boyd Gaming common stock in the merger being proposed?

A:	The Boyd Gaming board of directors and the Coast Casinos board of directors believe that:

•

combining Boyd Gaming with Coast Casinos would establish one of the largest casino operators in the United States;

•

the companies’ experience, resources and breadth of geographical scope will allow the combined company to better compete with larger competitors in the hotel-casino industry; and

•

the merger of Coast Casinos with Boyd Gaming will provide reasonable growth opportunities for the combined company after the consummation of the merger.

Q:	What will happen if the merger is completed?

Boyd Gaming will acquire Coast Casinos through the merger of Coast Casinos with and into a wholly owned subsidiary of Boyd Gaming. The wholly owned subsidiary of Boyd Gaming will be the surviving corporation in the merger and, at the effective time of the merger, will change its name to “Coast Casinos, Inc.” After the merger, the new Coast Casinos, Inc. will continue as a wholly owned subsidiary of Boyd Gaming.

Q:	When will the merger be completed?

The merger will be completed when the conditions described below under “The Merger Agreement—Conditions to the Merger” are satisfied. Boyd Gaming and Coast Casinos believe that the merger can be completed by mid-2004. There can be no guarantee, however, as to when all conditions to the merger will be satisfied and the completion of the merger will occur, if at all. See “Risk Factors—Risks Relating to the Merger” beginning on page 25.

QUESTIONS AND ANSWERS FOR COAST CASINOS STOCKHOLDERS

Q:	When and where is the annual meeting of the Coast Casinos stockholders?

A:	The Coast Casinos annual meeting will take place on April 29, 2004, at 5:00 p.m., local time. The location of the annual meeting is the Esplanade Room at The Orleans Hotel and Casino, 4500 West Tropicana Avenue, Las Vegas, Nevada 89103.

Q:	What are the Coast Casinos stockholders voting on and why?

A:	Coast Casinos stockholders are voting on a proposal to approve the merger agreement and the merger. The approval of the merger agreement by the Coast Casinos stockholders is a condition to the effectiveness of the merger.

In addition, Coast Casinos stockholders are voting on the following matters at the Coast Casinos annual meeting, each as more fully described in Chapter III—Information About the Coast Casinos Annual Meeting and Other Proposals beginning on page 132:

•

to elect four Class II directors of Coast Casinos to serve until the earlier of the consummation of the merger or the 2007 Annual Meeting of Stockholders; and

•

to transact such other business as may properly come before the Coast Casinos annual meeting and any adjournments or postponements thereof.

Q:	What will Coast Casinos stockholders receive in the merger?

With respect to each Coast Casinos stockholder (other than Michael J. Gaughan, the Chairman and Chief Executive Officer of Coast Casinos, Jerry Herbst, a director and the Treasurer of Coast Casinos, and Franklin Toti, a director and the Vice President of Casino Operations of Coast Casinos), at the effective time of the merger, each issued and outstanding share of Coast Casinos common stock held by each such stockholder will be converted into the right to receive $550 in cash, unless an election is made in a timely manner by such Coast Casinos stockholder to receive 32.8025 shares of Boyd Gaming common stock for such share of Coast Casinos common stock. The maximum aggregate number of shares of Boyd Gaming common stock issuable in the merger to Coast Casinos stockholders, other than Messrs. Gaughan and Toti, will be approximately 1,009,194 shares (subject to the rounding mechanics of the proration provisions of the merger agreement), unless an adjustment is required in order to qualify the merger as a reorganization within the meaning of Section 368(a) of the Internal Revenue Code of 1986, as amended. The amount of stock consideration and cash consideration that each Coast Casinos stockholder, other than Messrs. Gaughan and Toti, will be entitled to receive at the effective time of the merger will have an aggregate value of at least $550 per share of Coast Casinos common stock exchanged in the merger and will be subject to adjustment and proration as described below under “The Merger Agreement—Consideration to be Received in the Merger—Adjustment to the Merger Consideration and Proration” on page 68. Each Coast Casinos stockholder, other than Messrs. Gaughan, Herbst and Toti, may elect different consideration for each share of Coast Casinos common stock held by such stockholder, subject to the adjustment and proration terms and procedures of the merger agreement. However, because the aggregate number of shares of Boyd Gaming common stock that may be issued to Coast Casinos stockholders, other than Messrs. Gaughan and Toti, in the merger is limited to approximately 1,009,194 shares, unless adjusted pursuant to the terms of the merger agreement, it is possible that a substantial portion of the merger consideration received by each such Coast Casinos stockholder will be in the form of cash consideration, regardless of the election made by such stockholder.

At the effective time of the merger, each issued and outstanding share of Coast Casinos common stock held by Messrs. Gaughan and Toti will be converted into the right to receive 32.8025 shares of Boyd Gaming common stock. In addition, each issued and outstanding share of Coast Casinos common stock held by Mr. Herbst will be converted into the right to receive $550 in cash.

Q:	How and when can I make my election?

An election form has been sent to the Coast Casinos stockholders together with this joint proxy statement/prospectus for making elections for consideration consisting of shares of Boyd Gaming common stock. To be effective, the election form must be properly completed, signed and received by the exchange agent, together with the stock certificates representing shares of Coast Casinos common stock with respect to which the election for stock consideration is being made, no later than 5:00 p.m., Pacific time, on April 28, 2004. If a properly completed and signed election form with respect to shares of Coast Casinos common stock is not received by the exchange agent, together with the appropriate stock certificates, by 5:00 p.m., Pacific time, on April 28, 2004, then the holder of those shares of Coast Casinos common stock will be deemed to have made an election for cash consideration in respect of those shares of Coast Casinos common stock.

Q:	Will I receive the specific amount of stock consideration that I elect to receive?

Not necessarily. Elections for stock consideration, or non-elections for cash consideration, will be subject to the adjustment and proration procedures set forth in the merger agreement. See “The Merger Agreement—Consideration to be Received in the Merger—Adjustments to the Merger Consideration and Proration” on page 68.

Q:	What are the tax consequences of the merger?

A:	Boyd Gaming and Coast Casinos intend for the merger to qualify as a reorganization within the meaning of Section 368(a) of the Internal Revenue Code of 1986, as amended. As a result, the tax consequences of the merger to Coast Casinos stockholders will be generally as follows:

•

Coast Casinos stockholders who exchange their shares of Coast Casinos common stock solely for cash will recognize gain or loss for U.S. Federal income tax purposes;

•

Coast Casinos stockholders who exchange their shares of Coast Casinos common stock for a combination of cash and shares of Boyd Gaming common stock may recognize gain, but not loss, in the exchange; and

•

Coast Casinos stockholders who exchange their shares of Coast Casinos common stock solely for shares of Boyd Gaming common stock will not recognize gain or loss for U.S. Federal income tax purposes, other than gain or loss attributable to the receipt of cash in the merger in lieu of fractional shares of Boyd Gaming common stock.

For a full description of the tax consequences of the merger for Coast Casinos stockholders, see “The Merger—U.S. Federal Income Tax Consequences of the Merger” beginning on page 60.

Q:	What vote of Coast Casinos stockholders will be required to approve the merger agreement and the merger?

The approval of the merger agreement and the merger requires the affirmative vote of a majority of the voting power of the holders of the outstanding shares of Coast Casinos common stock. Messrs. Gaughan, Herbst and Toti, who hold an aggregate of approximately 56% of the voting power of the outstanding shares of Coast Casinos common stock, have entered into an agreement with Boyd Gaming pursuant to which they have agreed to, among other things, vote their shares of Coast Casinos common stock in favor of the approval of the merger agreement and the merger. See “The Merger—Stockholders Agreement” beginning on page 55.

If, however, prior to the Coast Casinos annual meeting, the Coast Casinos board of directors withdraws or modifies its approval or recommendation of the merger agreement and the merger as a result of a superior proposal in accordance with the terms of the merger agreement, then the approval of the merger agreement and the merger will also require approval by a majority of the voting power of the holders of the outstanding Coast Casinos common stock present and duly voted, in person or by proxy, at the Coast Casinos annual meeting, exclusive of those votes taken in respect of the shares of Coast Casinos common stock held by Messrs. Gaughan, Herbst and Toti. See “The Merger Agreement—Coast Casinos Meeting” on page 76.

Q:	What should I do now in order to vote on the proposal to approve the merger agreement and the merger?

After carefully reading and considering the information contained in this joint proxy statement/prospectus, please complete and sign the enclosed proxy card and return it in the enclosed postage-paid envelope as soon as possible so that your shares may be represented at the Coast Casinos annual meeting. You may also cast your vote by attending the Coast Casinos annual meeting in person.

Q:	What do I do if I want to revoke my proxy?

A proxy may be revoked at any time before it is voted by delivering to Coast Casinos, Attn: Corporate Secretary, at the principal executive office of Coast Casinos indicated below under “Summary—Information About the Companies—Coast Casinos” on page 7, a written notice of revocation or a duly executed proxy bearing a later date than the proxy being revoked. Simply attending the Coast Casinos annual meeting, however, will not revoke your proxy. If you have instructed a broker to vote your shares, you must follow the directions of your broker to revoke your proxy.

Q:	What will happen if I abstain from voting on the merger agreement and the merger?

A:	An abstention or failure to vote will have the same effect as a vote against the approval of the merger agreement and the merger.

Q:	Do I have dissenters’ rights?

Yes. Coast Casinos stockholders will have dissenters’ rights under Nevada law as a result of the merger. In order to exercise dissenters’ rights, a stockholder, among other things, must not vote in favor of the merger and must follow the procedures specified in Nevada Revised Statutes Sections 92A.300 through 92A.500, inclusive, a copy of which is included as Annex D to this joint proxy statement/prospectus. See “The Merger—Dissenters’ Rights of Coast Casinos Stockholders” beginning on page 63. However, Messrs. Gaughan, Herbst and Toti have each agreed in the stockholders agreement entered into with Boyd Gaming to waive their dissenters’ rights with respect to the merger.

Q:	Who should I contact if I have questions?

If you have any questions about the merger agreement or the merger or if you need additional copies of this joint proxy statement/prospectus or the enclosed proxy card, you should contact Coast Casinos, Inc., Attn: Gage Parrish at 4500 West Tropicana Avenue, Las Vegas, Nevada 89103, by phone at (702) 365-7000 or by e-mail at gparrish@coastcasinos.net.

QUESTIONS AND ANSWERS FOR BOYD GAMING STOCKHOLDERS

Q:	When and where is the annual meeting of the Boyd Gaming stockholders?

A:	The Boyd Gaming annual meeting will take place on April 30, 2004, at noon, local time. The location of the annual meeting is Borgata Hotel Casino and Spa, One Borgata Way, Atlantic City, New Jersey 08401.

Q:	What are Boyd Gaming stockholders voting on and why?

Boyd Gaming stockholders are voting on a proposal to approve the issuance of shares of Boyd Gaming common stock in connection with the merger. This stockholder vote is required under the rules of the New York Stock Exchange because the aggregate number of shares of Boyd Gaming common stock to be issued to Coast Casinos stockholders in the merger will exceed 20% of the total number of shares of Boyd Gaming common stock issued and outstanding immediately prior to the completion of the merger.

In addition, Boyd Gaming stockholders are voting on the following matters at the Boyd Gaming annual meeting, each as more fully described in Chapter II—Information About the Boyd Gaming Annual Meeting and Other Proposals beginning on page 105:

•

to elect three Class I directors of Boyd Gaming to serve until the 2007 Annual Meeting of Stockholders or until their successors are duly elected and qualified;

•

to ratify the appointment of Deloitte & Touche LLP as Boyd Gaming’s independent auditor for the fiscal year ending December 31, 2004;

•

to approve an amendment to Boyd Gaming’s 2002 Stock Incentive Plan to increase the number of shares of Boyd Gaming common stock subject to the 2002 Stock Incentive Plan from 3,000,000 shares to 7,000,000 shares; and

•

to transact such other business as may properly come before the Boyd Gaming annual meeting and any adjournments or postponements thereof.

Q:	How will I be affected by the merger and share issuance?

After the merger, you will have the same number of shares of Boyd Gaming common stock that you had immediately prior to the merger. However, because Boyd Gaming will be issuing new shares of Boyd Gaming common stock to certain Coast Casinos stockholders in the merger, each outstanding share of Boyd Gaming common stock immediately prior to the merger will represent a smaller percentage of the aggregate number of shares of Boyd Gaming common stock after the merger. You will not recognize any gain or loss for U.S. Federal income tax purposes upon consummation of the merger.

Q:	What vote of Boyd Gaming stockholders is required to approve the share issuance?

The issuance of shares of Boyd Gaming common stock in the merger requires the approval by a majority of the votes cast by Boyd Gaming stockholders at the Boyd Gaming annual meeting, provided that the total vote cast must represent over 50% in interest of all Boyd Gaming securities entitled to vote on such proposal at the Boyd Gaming annual meeting.

Q:	What should I do now in order to vote on the share issuance proposal?

After carefully reading and considering the information contained in this joint proxy statement/prospectus, please mark, sign and date the enclosed proxy card and return it in the enclosed postage-paid envelope as soon as possible so that your shares may be represented at the Boyd Gaming annual meeting. You may also cast your vote by attending the Boyd Gaming annual meeting in person or by voting your shares via the Internet or by telephone by following the instructions on the back of your proxy card.

Q:	What do I do if I want to revoke my proxy?

A proxy may be revoked at any time before it is voted by delivering to Boyd Gaming, Attn: Brian A. Larson, Secretary and General Counsel, at the principal executive office of Boyd Gaming indicated below under “Summary—Information About the Companies—Boyd Gaming” on page 7, a written notice of revocation or a duly executed proxy bearing a later date than the proxy being revoked. The mere presence of a stockholder at the Boyd Gaming annual meeting will not revoke his or her proxy.

Q:	What will happen if I abstain from voting on the share issuance proposal?

A:	Assuming the presence of a quorum for purposes of voting on the proposal to approve the issuance of shares of Boyd Gaming common stock in the merger, an abstention or failure to vote will have the same effect as a vote against the proposal.

Q:	Do I have dissenters’ rights?

A:	No. Boyd Gaming stockholders will not have dissenters’ rights under Nevada law as a result of the merger.

Q:	Who should I contact if I have questions?

If you have any questions about the merger agreement, the merger or the issuance of shares of Boyd Gaming common stock in the merger or if you need additional copies of this joint proxy statement/prospectus or the enclosed proxy card, you should contact Boyd Gaming Corporation, Attn: Brian A. Larson, Secretary and General Counsel, at 2950 Industrial Road, Las Vegas, Nevada 89109, by phone at (702) 792-7000 or by e-mail at brianlarson@boydgaming.com.

SUMMARY

This summary does not contain all of the information that may be important to Boyd Gaming stockholders and Coast Casinos stockholders and is qualified in its entirety by reference to the information contained elsewhere, or incorporated by reference, in this joint proxy statement/prospectus. Boyd Gaming stockholders and Coast Casinos stockholders are urged to read the entire joint proxy statement/prospectus, including the information set forth in the section entitled “Risk Factors” beginning on page 25, and the attached annexes. See Chapter IV—Additional Information beginning on page 147.

Information About the Companies

Boyd Gaming

Boyd Gaming is a diversified operator of twelve wholly owned gaming entertainment properties and one joint venture property. Boyd Gaming is headquartered in Las Vegas, Nevada, with operations in Nevada, Illinois, Louisiana, Mississippi, Indiana and New Jersey. Boyd Gaming has operated successfully for over 25 years, primarily due to its geographically diverse properties, its emphasis on slot revenues, its comprehensive marketing and promotion programs, its opportunistic acquisitions and its experienced management team. The principal executive office of Boyd Gaming is located at 2950 Industrial Road, Las Vegas, Nevada 89109, and its telephone number is (702) 792-7200. Based on the closing price of a share of Boyd Gaming common stock on the New York Stock Exchange (trading symbol: “BYD”) on March 26, 2004 ($22.68) and the number of shares of Boyd Gaming common stock outstanding on that date (65,492,015), Boyd Gaming’s market capitalization on that date was approximately $1,485,358,900.

Additional information concerning Boyd Gaming is included in the reports that Boyd Gaming periodically files with the SEC. See Chapter IV—Additional Information beginning on page 147.

Coast Casinos

Coast Casinos owns and operates, through its wholly owned subsidiary Coast Hotels and Casinos, Inc., a Nevada corporation, which is referred to as “Coast Hotels,” four Las Vegas hotel-casinos: The Orleans, the Gold Coast, the Suncoast and the Barbary Coast. The Gold Coast, the Suncoast and The Orleans are strategically located to capitalize on the strong demographics of the Las Vegas locals market, while the Barbary Coast is located in the center of the Las Vegas Strip. Coast Casinos strives to attract a significant volume of repeat gaming customers to its casinos on a daily basis by offering consistently high-quality gaming, hotel, entertainment and dining experiences at attractive prices. Since 1979, Coast Casinos and its predecessor entities have maintained a successful track record of building, developing and operating hotel-casinos designed to appeal to the Las Vegas locals market. The principal executive office of Coast Casinos is located at 4500 West Tropicana Avenue, Las Vegas, Nevada 89103, and its telephone number is (702) 365-7000.

Additional information concerning Coast Casinos is included in the reports that Coast Casinos periodically files with the SEC. See Chapter IV—Additional Information beginning on page 147.

Overview of the Merger and Consideration to be Received in the Merger (pages 35 and 67)

Boyd Gaming, its direct wholly owned subsidiary BGC, Inc. and Coast Casinos have entered into the merger agreement pursuant to which Boyd Gaming will acquire Coast Casinos through a merger of Coast Casinos with and into BGC, Inc. BGC, Inc. will be the surviving corporation in the merger and, at the effective time of the merger, will change its name to “Coast Casinos, Inc.” After the merger, the new Coast Casinos, Inc. will continue as a wholly owned subsidiary of Boyd Gaming.

With respect to all Coast Casinos stockholders (other than Michael J. Gaughan, Jerry Herbst and Franklin Toti), who are referred to as the “minority stockholders,” at the effective time of the merger, each issued and outstanding share of Coast Casinos common stock held by a minority stockholder will be converted into the right to receive $550 in cash, unless an election is made in a timely manner by the minority stockholder to receive 32.8025 shares of Boyd Gaming common stock for such share of Coast Casinos common stock.

If the aggregate number of shares of Boyd Gaming common stock elected by minority stockholders would exceed 1,009,194 shares, as that number may be adjusted in accordance with the terms of the merger agreement in order to qualify the merger as a reorganization within the meaning of Section 368(a) of the Internal Revenue Code of 1986, as amended, which is referred to as the “Internal Revenue Code,” then the exchange agent will allocate, on a pro rata basis with respect to those shares of Coast Casinos common stock for which a stock election has been made, a sufficient number of shares of Coast Casinos common stock held by minority stockholders to be converted into cash consideration instead of stock consideration so that the aggregate number of shares of Boyd Gaming common stock issued to minority stockholders equals approximately 1,009,194 shares (subject to the rounding mechanics of the proration provisions of the merger agreement), as that number may be adjusted.

If the aggregate amount of cash to be paid to minority stockholders following the election would exceed $336,170,276.20, as that amount may be adjusted in accordance with the terms of the merger agreement in order to qualify the merger as a reorganization within the meaning of Section 368(a) of the Internal Revenue Code, then the exchange agent will allocate, on a pro rata basis with respect to those shares of Coast Casinos common stock for which a stock election has not been made, a sufficient number of shares of Coast Casinos common stock held by minority stockholders to be converted into stock consideration instead of cash consideration so that the aggregate amount of cash to be paid to minority stockholders equals approximately $336,170,276.20 (subject to the rounding mechanics of the proration provisions of the merger agreement), as that number may be adjusted.

As a result, it is likely that the actual proportion of cash consideration and stock consideration that each minority stockholder will receive in the merger will differ from the proportion of cash consideration and stock consideration that the minority stockholder elects to receive. Because the aggregate number of shares of Boyd Gaming common stock that may be issued to minority stockholders in the merger is limited to approximately 1,009,194 shares, unless adjusted pursuant to the terms of the merger agreement, it is possible that a substantial portion of the merger consideration received by each minority stockholder will be in the form of cash consideration, regardless of the election made by the minority stockholder. For a full description of the proration terms and procedures, see “The Merger Agreement—Consideration to be Received in the Merger—Adjustments to the Merger Consideration and Proration” on page 68.

The Stockholder Meetings (pages 105 and 132)

Date, time and place

Boyd Gaming. The annual meeting of Boyd Gaming stockholders, which is referred to as the “Boyd Gaming Meeting,” will be held at noon, local time, on April 30, 2004 at:

Borgata Hotel Casino and Spa

One Borgata Way

Atlantic City, New Jersey 08401

Coast Casinos. The annual meeting of Coast Casinos stockholders, which is referred to as the “Coast Casinos Meeting,” will be held at 5:00 p.m., local time, on April 29, 2004 in:

The Esplanade Room at The Orleans Hotel and Casino

4500 West Tropicana Avenue

Las Vegas, Nevada 89103

Matters to be considered

Boyd Gaming. At the Boyd Gaming Meeting, Boyd Gaming stockholders will consider and vote upon a proposal to approve the issuance of shares of Boyd Gaming common stock in the merger. In addition, Boyd Gaming stockholders will consider and vote upon the following matters, in each case as more fully described below under Chapter II—Information About the Boyd Gaming Annual Meeting and Other Proposals:

•

to elect three Class I directors of Boyd Gaming to serve until the 2007 Annual Meeting of Stockholders or until their successors are duly elected and qualified;

•

to ratify the appointment of Deloitte & Touche LLP as Boyd Gaming’s independent auditor for the fiscal year ending December 31, 2004;

•

to transact such other business as may properly come before the Boyd Gaming Meeting and any adjournments or postponements thereof.

Coast Casinos. At the Coast Casinos Meeting, Coast Casinos stockholders will consider and vote upon a proposal to approve the merger agreement and the merger. In addition, Coast Casinos stockholders will consider and vote upon the following matters, in each case as more fully described under Chapter III—Information About the Coast Casinos Annual Meeting and Other Proposals:

•

to elect four Class II directors of Coast Casinos to serve until the earlier of the consummation of the merger or the 2007 Annual Meeting of Stockholders; and

•

to transact such other business as may properly come before the Coast Casinos Meeting and any adjournments or postponements thereof.

Record dates, shares entitled to vote and vote required

Boyd Gaming. Holders of record of Boyd Gaming common stock are entitled to cast one vote for each share of Boyd Gaming common stock held at the close of business on March 31, 2004, the record date for the Boyd Gaming Meeting. As of the close of business on March 26, 2004, 65,492,015 shares of Boyd Gaming common stock were outstanding and entitled to vote, of which a total of 29,729,160 shares, or approximately 45.4% of the total outstanding shares of Boyd Gaming common stock, were held by Boyd Gaming’s directors and executive officers.

Assuming a quorum is present, the vote of a majority of the votes cast by Boyd Gaming stockholders at the Boyd Gaming Meeting is required to approve the issuance of shares of Boyd Gaming common stock in the merger, provided that the total vote cast must represent over 50% in interest of all Boyd Gaming securities entitled to vote on such proposal at the Boyd Gaming Meeting. The vote required to approve the other proposals to be submitted to the Boyd Gaming stockholders at the Boyd Gaming Meeting is described below under Chapter II—Information About the Boyd Gaming Annual Meeting and Other Proposals.

Coast Casinos. Holders of record of Coast Casinos common stock are entitled to cast one vote for each share of Coast Casinos common stock held at the close of business on March 31, 2004, the record date for the Coast Casinos Meeting. As of the close of business on March 26, 2004, there were 1,461,177.94 shares of Coast Casinos common stock outstanding and entitled to vote, of which a total of 988,442.18 shares, or approximately 67.6% of the total outstanding shares of Coast Casinos common stock, were held by Coast Casinos’ directors and executive officers.

Assuming a quorum is present, the affirmative vote of a majority of the voting power of the holders of the outstanding shares of Coast Casinos common stock is required to approve the merger agreement and the merger. As further discussed below under “The Merger—Stockholders Agreement,” Boyd Gaming has entered into an agreement with Messrs. Gaughan, Herbst and Toti, who hold an aggregate of approximately 56% of the voting power of the outstanding shares of Coast Casinos common stock, pursuant to which they have agreed, among other things, to vote their shares in favor of the approval of the merger agreement and the merger. If, however, prior to the Coast Casinos Meeting, the Coast Casinos board of directors withdraws or modifies its approval or recommendation of the merger agreement and the merger as a result of a superior proposal in accordance with the terms of the merger agreement, then the approval of the merger agreement and the merger will also require approval by a majority of the voting power of the holders of the outstanding Coast Casinos common stock present and duly voted, in person or by proxy, at the Coast Casinos Meeting, exclusive of those votes taken in respect of the shares of Coast Casinos common stock held by Messrs. Gaughan, Herbst and Toti. See “The Merger Agreement—Coast Casinos Meeting.” The vote required to approve the other proposals to be submitted to the Coast Casinos stockholders at the Coast Casinos Meeting is described below under Chapter III—Information About the Coast Casinos Annual Meeting and Other Proposals.

Changing a vote after a proxy card has been sent

Boyd Gaming. A proxy may be revoked at any time before it is voted by delivering to Boyd Gaming, Attn: Brian A. Larson, Secretary and General Counsel, at the principal executive office of Boyd Gaming indicated above under “—Information About the Companies—Boyd Gaming,” a written notice of revocation or a duly executed proxy bearing a later date than the proxy being revoked. The mere presence of a stockholder at the Boyd Gaming Meeting alone will not revoke his or her proxy.

Coast Casinos. A proxy may be revoked at any time before it is voted by delivering to Coast Casinos, Attn: Corporate Secretary, at the principal executive office of Coast Casinos indicated above under “—Information About the Companies—Coast Casinos,” a written notice of revocation or a duly executed proxy bearing a later date than the proxy being revoked. Simply attending the Coast Casinos Meeting, however, will not revoke the proxy of a Coast Casinos stockholder. If a Coast Casinos stockholder has instructed a broker to vote his or her shares of Coast Casinos common stock, he or she must follow the directions of the broker to revoke the proxy.

Quorum

A quorum must be present to transact business at each of the meetings. If a Boyd Gaming stockholder or a Coast Casinos stockholder submits a properly executed proxy card, even if that person abstains from voting, his or her shares will be counted for purposes of calculating whether a quorum is present at the Boyd Gaming Meeting or the Coast Casinos Meeting, as applicable.

A quorum at the Boyd Gaming Meeting and the Coast Casinos Meeting requires the presence, whether in person or by proxy, of a majority of the Boyd Gaming common stock or the Coast Casinos common stock, respectively, issued and outstanding as of the applicable record date and entitled to vote at the Boyd Gaming Meeting or the Coast Casinos Meeting, respectively.

Effect of abstentions and broker non-votes

Boyd Gaming. Abstentions, but not “broker non-votes,” will be counted in determining whether a quorum is present at the Boyd Gaming Meeting for purposes of the vote of the Boyd Gaming stockholders on the proposal to approve the issuance of shares of Boyd Gaming common stock in the merger. Abstentions will have the same effect as a vote cast against this proposal. “Broker non-votes” will not count as votes either for or against the proposal.

For information on the effect of abstentions and “broker non-votes” on the other proposals to be considered by the Boyd Gaming stockholders at the Boyd Gaming Meeting, see Chapter II—Information About the Boyd Gaming Annual Meeting and Other Proposals beginning on page 105.

Coast Casinos. Both abstentions and “broker non-votes” will be counted in determining whether a quorum is present at the Coast Casinos Meeting. For Coast Casinos stockholders, abstentions and “broker non-votes” will have the same effect as a vote against the approval of the merger agreement and the merger.

For information on the effect of abstentions and “broker non-votes” on the other proposals to be considered by the Coast Casinos stockholders at the Coast Casinos Meeting, see Chapter III—Information About the Coast Casinos Annual Meeting and Other Proposals beginning on page 132.

General. An abstention occurs when a stockholder attends a meeting, either in person or by proxy, but abstains from voting. However, if no instruction as to how to vote is given in an executed, duly returned and not revoked proxy, the proxy will be voted for each proposal described below in Chapter II—Information About the Boyd Gaming Annual Meeting and Other Proposals, in the case of the Boyd Gaming Meeting, and for each proposal described below in Chapter III—Information About the Coast Casinos Annual Meeting and Other Proposals, in the case of the Coast Casinos Meeting.

It is very important that ALL Boyd Gaming stockholders and ALL Coast Casinos stockholders vote their shares, so please promptly complete and return the enclosed proxy card.

Board Recommendations (pages 41 and 43)

The Boyd Gaming board of directors’ recommendation

The Boyd Gaming board of directors has unanimously approved entering into the merger agreement and the stockholders agreement and recommends the approval of the issuance of shares of Boyd Gaming common stock in the merger by the Boyd Gaming stockholders.

The Coast Casinos board of directors’ recommendation

The Coast Casinos board of directors has unanimously adopted the merger agreement and approved the merger and recommends that the Coast Casinos stockholders vote to approve the merger agreement and the merger.

Some directors and executive officers of Coast Casinos have interests in the merger that are in addition to or differ from those of Coast Casinos stockholders generally. See “The Merger—Interests of Coast Casinos’ Directors and Executive Officers in the Merger” beginning on page 53.

The Merger (page 35)

The rights and obligations of the parties to the merger agreement are governed by the specific terms and conditions of the merger agreement and not by any summary or other information in this joint proxy statement/

prospectus. Therefore, the information in this joint proxy statement/prospectus regarding the merger agreement and the merger is qualified in its entirety by reference to the merger agreement itself, a copy of which is attached as Annex A to this joint proxy statement/prospectus.

Consideration to be received in the merger

The merger consideration to be received by Coast Casinos stockholders is described above under “—Overview of the Merger and Consideration to be Received in the Merger.” For a full description of the merger consideration to be received in the merger by Coast Casinos stockholders, see “The Merger Agreement—Consideration to be Received in the Merger” beginning on page 67.

Election by Coast Casinos stockholders

An election form has been sent to the Coast Casinos stockholders together with this joint proxy statement/prospectus for making elections for consideration consisting of Boyd Gaming common stock. To be effective, the election form must be properly completed, signed and received by the exchange agent, together with the stock certificates representing shares of Coast Casinos common stock with respect to which the election for stock consideration is being made, no later than 5:00 p.m., Pacific time, on April 28, 2004. If a properly completed and signed election form with respect to shares of Coast Casinos common stock is not received by the exchange agent, together with the appropriate stock certificates, by 5:00 p.m., Pacific time, on April 28, 2004, then the holder of those shares of Coast Casinos common stock will be deemed to have made an election for cash consideration in respect of those shares of Coast Casinos common stock. For a full description of the election procedures for the minority stockholders of Coast Casinos common stock, see “The Merger Agreement—Procedures for Exchange of Certificates; Fractional Shares—Coast Casinos Common Stock—Election” on page 70.

Coast Casinos stock options

In connection with the merger,

•

each Coast Casinos employee stock option that is not an incentive stock option and that is outstanding immediately prior to the effective time of the merger will be canceled immediately prior to the effective time of the merger, whether vested or unvested, with the holder of the employee stock option becoming entitled to receive an amount of cash equal to the excess, if any, of $550 over the per share exercise price of the employee stock option, multiplied by the number of shares of Coast Casinos common stock subject to the employee stock option, subject to any applicable withholding of taxes; and

•

each Coast Casinos incentive stock option that is outstanding immediately prior to the effective time of the merger will be deemed to constitute an option to acquire, on the same terms and conditions as were applicable under the incentive stock option, 32.8025 shares of Boyd Gaming common stock at a price per share equal to $3.04855, subject to adjustment to comply with the Internal Revenue Code.

For a full description of the treatment of Coast Casinos stock options, see “The Merger Agreement—Coast Casinos Stock Options and Benefit Plans—Coast Casinos Stock Options” beginning on page 77.

Boyd Gaming’s financial advisor

Deutsche Bank Securities Inc., which is referred to as “Deutsche Bank,” rendered its opinion to the Boyd Gaming board of directors that, as of February 6, 2004, and based upon and subject to the assumptions made, matters considered and limits of the review undertaken by Deutsche Bank, the merger consideration was fair, from a financial point of view, to Boyd Gaming.

The full text of the written opinion of Deutsche Bank, dated February 6, 2004, is attached as Annex B to this joint proxy statement/prospectus. For a description of the opinion, see “The Merger—Opinion of Boyd Gaming’s Financial Advisor” beginning on page 43. Deutsche Bank provided its opinion for the information and assistance of the Boyd Gaming board of directors in connection with its consideration of the merger. The Deutsche Bank opinion is not an opinion or recommendation as to how the Boyd Gaming stockholders or Coast Casino stockholders should vote at their respective stockholder meetings in connection with the merger.

Coast Casinos’ financial advisor

Banc of America Securities LLC, which is referred to as “Banc of America Securities,” rendered its opinion to the Coast Casinos board of directors that, as of February 6, 2004, and based upon and subject to various assumptions and limitations set forth therein, the stock and cash consideration to be received by Coast Casinos stockholders, other than Messrs. Gaughan, Herbst and Toti, in the proposed merger is fair from a financial point of view to the Coast Casinos stockholders, other than Messrs. Gaughan, Herbst and Toti.

The full text of the written opinion of Banc of America Securities, dated February 6, 2004, is attached as Annex C to this joint proxy statement/prospectus. For a description of the opinion, see “The Merger—Opinion of Coast Casinos’ Financial Advisor” beginning on page 48. Banc of America Securities provided its opinion for the information and assistance of the Coast Casinos board of directors in connection with its consideration of the merger. The Banc of America Securities opinion is not an opinion or recommendation as to how the Coast Casinos stockholders or Boyd Gaming stockholders should vote at their respective stockholder meetings in connection with the merger.

Conditions to the merger

A number of conditions must be satisfied before the merger will be completed. These include:

•

the receipt of the approval of the Coast Casinos stockholders and the Boyd Gaming stockholders;

•

the approval for listing on the New York Stock Exchange of the Boyd Gaming common stock to be issued in the merger, subject to official notice of issuance;

•

the receipt of all consents, approvals, orders or authorizations from governmental entities required to consummate the merger and the other transactions contemplated by the merger agreement;

•

the expiration or termination of the waiting period under the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended, which is referred to as the “HSR Act”;

•

the absence of any legal restraints or prohibitions preventing the consummation of the merger;

•

the effectiveness of the Form S-4, of which this joint proxy statement/prospectus is a part, under the Securities Act of 1933, as amended, which is referred to as the “Securities Act”;

•

the absence of any material pending or threatened litigation against Boyd Gaming or Coast Casinos;

•

the correctness in all material respects of the representations and warranties of each party contained in the merger agreement;

•

the performance in all material respects of all obligations of the parties contained in the merger agreement;

•

the absence of material adverse changes with respect to either party; and

•

the delivery of tax opinions of legal counsel to each party to the effect that the merger will qualify as a reorganization within the meaning of Section 368(a) of the Internal Revenue Code.

Each of Boyd Gaming, BGC, Inc. and Coast Casinos may waive the conditions to the performance of its respective obligations under the merger agreement and complete the merger even though one or more of these conditions has not been met. Boyd Gaming and Coast Casinos cannot give any assurance that all of the conditions to the merger will be satisfied or waived or that the merger will occur. For a full description of the conditions to the merger, see “The Merger Agreement—Conditions to the Merger” beginning on page 81.

No solicitation

Coast Casinos has agreed not to, will not permit its subsidiaries to, and will not authorize or permit any officer, director, employee, investment banker, attorney or other advisors or representatives of Coast Casinos or any of its subsidiaries to:

•

solicit, initiate or encourage the submission of any takeover proposal;

•

enter into any agreement with respect to any takeover proposal; or

•

participate in any discussions or negotiations regarding, or furnish to any person any information with respect to, or take any other action to facilitate any inquiries or the making of any proposal that constitutes, or may reasonably be expected to lead to, a takeover proposal.

Coast Casinos may, however, before the Coast Casinos stockholders approve the merger agreement, in response to an unsolicited takeover proposal which the Coast Casinos board of directors determines, in good faith, after consultation with outside counsel and financial advisors, may reasonably be expected to lead to a superior proposal, furnish information with respect to Coast Casinos to the person making the takeover proposal and participate in discussions or negotiations with such person regarding a takeover proposal.

A “takeover proposal” means:

•

any proposal or offer for a merger, consolidation, dissolution, recapitalization or other business combination involving Coast Casinos;

•

any proposal for the issuance by Coast Casinos of over 30% of its equity securities as consideration for the assets or securities of another person; or

•

any proposal or offer to acquire in any manner over 30% of the equity securities or consolidated total assets of Coast Casinos,

in each case, other than the merger.

A “superior proposal” means any proposal by a third party to acquire substantially all the equity securities or assets of Coast Casinos, pursuant to a tender or exchange offer, a merger, a consolidation, a liquidation or dissolution, a recapitalization, a sale of all or substantially all its assets or otherwise, on terms which the Coast Casinos board of directors determines in good faith, after consultation with outside legal counsel and financial advisors, to be more favorable from a financial point of view to the holders of shares of Coast Casinos common stock than the merger with Boyd Gaming, taking into account all the terms and conditions of such proposal, the merger agreement and the stockholders agreement, including any proposal by Boyd Gaming to amend the terms of the merger.

For a full description of Coast Casinos’ obligations with respect to the no-solicitation provisions of the merger agreement, see “The Merger Agreement—No Solicitation” beginning on page 74.

Termination of the merger agreement

Boyd Gaming, BGC, Inc. and Coast Casinos may mutually agree in writing, at any time before the effective time of the merger, to terminate the merger agreement. Also, either Boyd Gaming or Coast Casinos may terminate the merger agreement before the effective time of the merger if:

•

the merger is not approved by January 31, 2005, unless extended to April 30, 2005 on the terms provided in the merger agreement;

•

any governmental entity prohibits the merger;

•

the Coast Casinos stockholders fail to approve the merger agreement at the Coast Casinos Meeting; or

•

the Boyd Gaming stockholders fail to approve the issuance of shares of Boyd Gaming common stock in the merger at the Boyd Gaming Meeting.

Boyd Gaming may terminate the merger agreement before the effective time of the merger if:

•

Coast Casinos breaches in any material respect any of its representations, warranties or covenants in the merger agreement that would give rise to the failure of a condition set forth in the merger agreement and such breach cannot be or has not been cured within 30 days by Coast Casinos; and

•

the aggregate number of shares of Boyd Gaming common stock required to be issued by Boyd Gaming in the merger in accordance with the terms described under “The Merger Agreement—Consideration to be Received in the Merger—Adjustments to the Merger Consideration and Proration” would exceed 7,837,077 shares of Boyd Gaming common stock.

Coast Casinos can terminate the merger agreement before the effective time of the merger if Boyd Gaming breaches in any material respect any of its representations, warranties or covenants in the merger agreement that would give rise to the failure of a condition set forth in the merger agreement and such breach cannot be or has not been cured within 30 days by Boyd Gaming.

For a full description of the rights of Boyd Gaming, BGC, Inc. and Coast Casinos to terminate the merger agreement, see “The Merger Agreement—Termination” on page 83.

Termination fee

A termination fee of $30.0 million is payable by Coast Casinos to Boyd Gaming if:

•

after the date of the merger agreement, any person makes a takeover proposal for Coast Casinos or amends a takeover proposal for Coast Casinos made prior to the date of the merger agreement; and

•

the merger agreement is terminated by either Coast Casinos or Boyd Gaming because the merger has not been consummated prior to January 31, 2005 or, if extended, April 30, 2005, or because the Coast Casinos stockholders fail to approve the merger agreement at the Coast Casinos Meeting, or the merger agreement is terminated by Boyd Gaming because Coast Casinos breaches in any material respect any of its representations, warranties or covenants in the merger agreement that would give rise to the failure of a condition set forth in the merger agreement and such breach cannot be or has not been cured within 30 days by Coast Casinos; and

•

within 30 months after the date of the merger agreement, Coast Casinos enters into a definitive agreement to consummate, or consummates, the transactions contemplated by a takeover proposal.

The termination fee will be payable and will be paid on the date of consummation of such takeover transaction. For a full description of the payment of the termination fee, see “The Merger Agreement—Fee if the Merger Agreement is Terminated” beginning on page 83.

Tax-free nature of the merger

Although Boyd Gaming and Coast Casinos intend for the merger to qualify as a reorganization within the meaning of Section 368(a) of the Internal Revenue Code, any cash consideration received in the merger by a Coast Casinos stockholder may result in that Coast Casinos stockholder being required to pay tax. For a full description of the tax consequences of the merger for Coast Casinos stockholders, see “The Merger—U.S. Federal Income Tax Consequences of the Merger” beginning on page 60. If, in order for the merger to qualify as a reorganization within the meaning of Section 368(a) of the Internal Revenue Code, the number of shares of Boyd Gaming common stock required to be issued to Coast Casinos stockholders in the merger, other than to Messrs. Gaughan and Toti, exceeds 7,837,077 shares of Boyd Gaming common stock, Boyd Gaming will have the right to terminate the merger agreement, as more fully described under “The Merger Agreement—Consideration to be Received in the Merger” beginning on page 67.

Governmental clearance

In order to complete the merger, Boyd Gaming and Coast Casinos must receive approvals from and make filings with various state and local regulatory agencies, including the Nevada State Gaming Control Board, the Nevada Gaming Commission, the Clark County Liquor and Gaming Licensing Board and the City of Las Vegas, as well as regulatory authorities in the other jurisdictions in which Boyd Gaming operates. The merger is also subject to the expiration or termination of the waiting period under the HSR Act. For a full description of the governmental approvals necessary to consummate the merger, see “The Merger—Governmental and Regulatory Matters” beginning on page 56.

Stockholders agreement

•

to vote, or cause to be voted, the shares of Coast Casinos common stock owned by him in favor of the approval of the merger agreement and the merger;

•

to vote, or cause to be voted, the shares of Coast Casinos common stock owned by him against any merger agreement or merger, other than the merger agreement entered into by Coast Casinos with Boyd Gaming and the merger of Coast Casinos with and into BGC, Inc., and any consolidation, combination, sale of substantial assets, joint venture, binding share exchange, reorganization, recapitalization, dissolution, liquidation or winding up of Coast Casinos, and against any other takeover proposal for Coast Casinos or any action that would reasonably be expected to, in any manner, impede, frustrate, interfere with, delay, prevent or nullify any provision of the merger agreement, the merger or any other transaction contemplated by the merger agreement; and

•

not to sell, transfer, pledge, assign or otherwise dispose of any of his shares of Coast Casinos common stock, enter into any voting arrangement with respect to his shares of Coast Casinos common stock, other than the stockholders agreement, or take any action which would, or could reasonably be expected to, result in a diminution of the voting power represented by his shares of Coast Casinos common stock,

in each case for a period of two years after the date of the stockholders agreement, unless the merger is consummated or the merger agreement is terminated for certain specified reasons.

Messrs. Gaughan, Herbst and Toti have also agreed to waive any rights to dissent from the merger. In addition, each of Messrs. Gaughan and Toti have agreed to enter into an additional stockholders agreement with Boyd Gaming and William S. Boyd regarding certain restrictions on the transfer of the shares of Boyd Gaming

common stock to be received by either Mr. Gaughan or Mr. Toti in the merger, including a right of first offer with respect to those shares of Boyd Gaming common stock in favor of Boyd Gaming first and then Mr. Boyd. Notwithstanding the foregoing, each of Messrs. Gaughan and Toti will be permitted to transfer the shares of Boyd Gaming common stock to be received by him in the merger to certain permitted transferees, including his estate.

For a full description of the terms and conditions of the stockholders agreement, see “The Merger—Stockholders Agreement” beginning on page 55.

Interests of Coast Casinos’ Directors and Executive Officers in the Merger (page 53)

In considering the recommendation of the Coast Casinos board of directors to approve the merger agreement and the merger, Coast Casinos stockholders should consider that some of Coast Casinos’ directors and officers have interests in the merger that differ from, or are in addition to, their interests as Coast Casinos stockholders. The Coast Casinos board of directors was aware of these interests and considered them, among other matters, in approving the merger and adopting the merger agreement.

As a result of these interests, these directors and officers could be more likely to vote to approve the merger agreement and the merger than if they did not hold these interests, and may have reasons for doing so that are not the same as the interests of Coast Casinos’ other stockholders. Coast Casinos stockholders should consider whether these interests may have influenced these directors and officers to support or recommend the approval of the merger agreement and the merger.

For a full description of the interests of Coast Casinos’ directors and executive officers in the merger, see “The Merger— Interests of Coast Casinos’ Directors and Executive Officers in the Merger” beginning on page 53.

Dividend Policies (page 103)

Boyd Gaming. The holders of Boyd Gaming common stock receive dividends if and when declared by the Boyd Gaming board of directors out of legally available funds. In July 2003 and October 2003, the Boyd Gaming board of directors declared dividends of $0.075 per share of Boyd Gaming common stock, totaling approximately $4.8 million and $4.9 million, respectively, that were paid in September 2003 and December 2003, respectively. In addition, in January 2004, the Boyd Gaming board of directors declared a dividend of $0.075 per share of Boyd Gaming common stock, which was paid on March 2, 2004 based on the Boyd Gaming stockholders of record on February 13, 2004.

The declaration and payment of dividends, however, is subject to the provisions of the Nevada Revised Statutes, which are referred to as the “NRS,” and will depend upon business conditions, operating results, capital and reserve requirements, covenants in Boyd Gaming’s debt agreements and the Boyd Gaming board of directors’ consideration of other relevant factors. Boyd Gaming can give no assurances that it will continue to pay dividends on the Boyd Gaming common stock in the future. See “The Merger—Impact of Increased Indebtedness on Dividends” on page 66.

Coast Casinos. Coast Casinos has historically paid dividends on shares of Coast Casinos common stock, when and as declared at the discretion of the Coast Casinos board of directors. Coast Casinos paid dividends to its stockholders of $3.50 per share on August 15, 2003 and $3.50 per share on February 5, 2004. Pursuant to the merger agreement, until the earlier of the consummation of the merger and the termination of the merger agreement, Coast Casinos is not permitted to declare, set aside or pay any dividend on shares of Coast Casinos common stock.

Material Differences in Rights of Boyd Gaming Stockholders and Coast Casinos Stockholders (page 99)

Coast Casinos stockholders receiving merger consideration in the form of shares of Boyd Gaming common stock will have different rights once they become Boyd Gaming stockholders due to differences in the governing documents of Boyd Gaming and Coast Casinos. These differences are described in detail under “Comparison of the Rights of Holders of Boyd Gaming Common Stock and Coast Casinos Common Stock” beginning on page 99.

Dissenters’ Rights of Coast Casinos Stockholders (page 63)

Under NRS Chapter 92A, dissenters’ rights are available to a corporation’s stockholders in connection with certain mergers and consolidations. Under NRS Chapter 92A, any Coast Casinos stockholder who follows the procedures specified in NRS Sections 92A.300 through 92A.500, inclusive, is entitled to dissent from the merger and obtain payment of the fair value of his or her shares of Coast Casinos common stock in lieu of the merger consideration. The fair value of the Coast Casinos common stock for this purpose will exclude any appreciation or depreciation in value of Coast Casinos common stock in anticipation of the merger.

In order for any Coast Casinos stockholder to exercise his or her dissenters’ rights, the stockholder, among other things, must file with Coast Casinos a written notice of the stockholder’s intent to demand payment for his or her shares of Coast Casinos common stock if the merger is effectuated and must not vote in favor of the approval of the merger agreement and the merger. Annex D to this joint proxy statement/prospectus contains a copy of NRS Sections 92A.300 through 92A.500, inclusive, which addresses dissenters’ rights.

Coast Casinos stockholders should particularly note the following:

•

simply voting against the approval of the merger agreement and the merger will not be considered an assertion of dissenters’ rights;

•

a Coast Casinos stockholder who fails to file a written notice of demand to Coast Casinos, Attn: Corporate Secretary at 4500 West Tropicana Avenue, Las Vegas, Nevada 89103 before the vote on the proposal to approve the merger agreement and the merger at the Coast Casinos Meeting is taken will lose his or her dissenters’ rights; and

•

stockholders who vote for the approval of the merger agreement and the merger will not have dissenters’ rights.

Notwithstanding the foregoing, Messrs. Gaughan, Herbst and Toti have agreed in the stockholders agreement to waive any rights that they have to dissent from the merger, as further described under “The Merger—Stockholders Agreement” beginning on page 55.

For a full description of the rights of Coast Casinos stockholders to dissent from the merger, see “The Merger—Dissenters’ Rights of Coast Casinos Stockholders” beginning on page 63 as well as Annex D to this joint proxy statement/prospectus.

Selected Historical Financial Data of Boyd Gaming

The following is Boyd Gaming’s selected consolidated financial data for each of the years in the five-year period ended December 31, 2003. The information with respect to the years ended December 31, 1999 through December 31, 2003 is derived from audited financial statements of Boyd Gaming contained in its Annual Reports on Form 10-K for the years ended December 31, 2001, 2002 and 2003. This summary should be read together with the consolidated financial statements, which are incorporated by reference in this joint proxy statement/prospectus, the accompanying notes and management’s discussion and analysis of financial condition and results of operations of Boyd Gaming contained in Boyd Gaming’s reports referred to above, as well as the unaudited pro forma condensed combined financial statements and the accompanying notes described under “Unaudited Pro Forma Condensed Combined Financial Statements” beginning on page 85.

The following is a listing of Boyd Gaming’s major acquisitions and disposals that occurred during the five year period ended December 31, 2003:

•

In October 1999, Boyd Gaming signed an agreement with the Mississippi Band of Choctaw Indians to terminate Boyd Gaming’s management of the Silver Star Resort and Casino in Philadelphia, Mississippi. Under the agreement, Boyd Gaming continued to manage Silver Star under the terms of the management contract through January 31, 2000, at which time the Mississippi Band of Choctaw Indians made, and Boyd Gaming recorded, a one-time payment of $71 million.

•

In November 1999, Boyd Gaming acquired Blue Chip Casino, L.L.C.

•

In May 2001, Boyd Gaming acquired substantially all of the assets of the Delta Downs Racetrack in Vinton, Louisiana, together with an off-track betting facility in Mound, Louisiana. Delta Downs began casino operations in February 2002 with approximately 1,500 slot machines.

•

On July 3, 2003, Borgata Hotel Casino and Spa, Boyd Gaming’s 50% owned-joint venture, began operations. Boyd Gaming uses the equity method to account for its investment in Borgata Hotel Casino and Spa.


	For the Year Ended December 31,
	2003		2002			2001		2000		1999
	(in thousands, except for per share amounts)
Consolidated Statement of Operations Data
Net revenues(a)	$	1,253,070	$	1,228,901		$	1,102,335	$	1,131,538	$	970,925
Operating expenses(b)		1,102,828		1,055,930			985,532		950,441		833,054
Operating loss from Borgata		1,442		8,496			920		1,544		1,260

Operating income		148,800		164,475			115,883		179,533		136,611
Interest expense, net(c)		74,231		72,456			73,951		77,496		68,977
Loss on early retirements of debt		—		15,055			—		—		—
Other expense from Borgata, net		8,754		—			—		—		—

Income before provision for income taxes and cumulative effects of changes in accounting principles		65,815		76,964			41,932		102,057		67,634
Provision for income taxes		24,882		28,740			16,982		39,292		27,595

Income before cumulative effects of changes in accounting principles		40,933		48,224			24,950		62,765		40,039
Cumulative effects of changes in accounting principles, net of tax		—		(8,212	)		—		—		(1,738	)

Net income	$	40,933	$	40,012		$	24,950	$	62,765	$	38,301

Per Share Data
Basic net income per common share:
Income before cumulative effects of changes in accounting principles	$	0.64	$	0.75		$	0.40	$	1.01	$	0.65
Cumulative effects of changes in accounting principles		—		(0.13	)		—		—		(0.03	)

Net income	$	0.64	$	0.62		$	0.40	$	1.01	$	0.62

Weighted average basic common shares		64,293		64,053			62,245		62,232		62,124

Diluted net income per common share:
Income before cumulative effects of changes in accounting principles	$	0.62	$	0.73		$	0.40	$	1.01	$	0.65
Cumulative effects of changes in accounting principles		—		(0.12	)		—		—		(0.03	)

Net income	$	0.62	$	0.61		$	0.40	$	1.01	$	0.62

Weighted average diluted common shares		66,163		66,125			62,360		62,278		62,293

Dividends on common stock	$	9,679	$	—		$	—	$	—	$	—

Dividends per share of common stock	$	0.15	$	—		$	—	$	—	$	—

Other Operating Data
Depreciation and amortization(d)	$	94,224	$	90,077		$	99,811	$	90,480	$	74,118
Preopening expenses		—		7,315			6,990		3,350		229
Capital expenditures		86,751		77,051			87,762		139,281		96,888
Balance Sheet Data
Total assets	$	1,872,997	$	1,912,990		$	1,754,913	$	1,577,614	$	1,143,981
Long-term debt (excluding current maturities)(e)		1,097,589		1,227,324			1,143,358		1,016,813		982,149
Stockholders’ equity		441,253		408,561			353,737		329,778		266,979

(a)	Net revenues for the year ended December 31, 2000 include approximately $71.0 million of net fee revenue which Boyd Gaming received upon the termination of the Silver Star management agreement.

(b)	Includes a loss on assets held for sale of approximately $3.8 million recorded for the year ended December 31, 2002.

(c)	Net of interest income and amounts capitalized.

(d)

On January 1, 2002, Boyd Gaming adopted Statement of Financial Accounting Standards No. 142, Goodwill and Other Intangible Assets. In connection with the initial application of SFAS No. 142, Boyd Gaming ceased the amortization of its goodwill and also ceased the amortization of its intangible license rights as Boyd Gaming determined that the intangible license rights have an indefinite life. In addition, Boyd Gaming recorded an $8.2 million charge as the cumulative effect of a change in accounting principle to write down the remaining goodwill balance related to the 1985 acquisition of the Stardust.

(e)

Long-term debt is decreased by $1.8 million of carrying value adjustments for the fair market value of Boyd Gaming’s related interest rate swap agreements at December 31, 2003. Long-term debt is increased by $4.8 million of carrying value adjustments for the fair market value of Boyd Gaming’s related interest rate swap agreement at December 31, 2002.

Selected Historical Financial Data of Coast Casinos

The following is Coast Casinos’ selected consolidated financial data as of and for each of the years in the five-year period ended December 31, 2003. The balance sheet and statement of operations data as of and for each of the five years in the period ended December 31, 2003 is derived from the audited financial statements of Coast Casinos (see footnote (d) to the table below). This summary should be read together with the consolidated financial statements as of December 31, 2002 and 2003 and for each of the three years in the period ended December 31, 2003, the accompanying notes and management’s discussion and analysis of financial condition and results of operations of Coast Casinos, which are incorporated by reference in this joint proxy statement/prospectus, as well as the unaudited pro forma condensed combined financial statements and the accompanying notes described under “Unaudited Pro Forma Condensed Combined Financial Statements” beginning on page 85.


	For the Year Ended December 31,
	2003			2002			2001			2000			1999
Consolidated Statement of Operations Data		(dollars in thousands, except for per share amounts)
Net revenues	$	592,498		$	545,120		$	517,984		$	408,925		$	358,324
Departmental operating expenses(a)		321,365			312,670			295,036			237,796			216,082
General and administrative expenses		108,952			104,228			91,558			69,443			60,480
Land leases		5,365			5,370			5,060			3,396			3,770
Deferred rent		3,118			3,228			3,538			2,538			2,918
Depreciation and amortization		48,962			41,575			36,549			25,375			21,613
Pre-opening expenses(b)		—			—			—			6,161			235

Operating income		104,736			78,049			86,243			64,216			53,226
Interest expense, net(c)		(36,289	)		(30,165	)		(29,182	)		(22,973	)		(21,441	)
Loss on early retirement of debt(d)		(419	)		—			—			—			(41,550	)
Other income (expense)		(678	)		425			(1,815	)		(60	)		(192	)

Income (loss) before income taxes		67,350			48,309			55,246			41,183			(9,957	)
Provision (benefit) for income taxes		23,032			16,595			18,815			14,405			(4,172	)

Net income (loss)	$	44,318		$	31,714		$	36,431		$	26,778		$	(5,785	)

Basic income (loss) per share of common stock	$	30.33		$	21.70		$	24.91		$	18.20		$	(3.91	)
Diluted income (loss) per share of common stock	$	29.78		$	21.38		$	24.32		$	17.92		$	(3.91	)
Basic weighted average common shares outstanding		1,461,178			1,461,178			1,462,366			1,471,208			1,478,978
Diluted weighted average common shares outstanding		1,487,937			1,483,392			1,497,781			1,494,066			1,478,978
Dividends on common stock	$	5,114		$	—		$	—		$	—		$	—

Dividends per share of common stock	$	3.50		$	—		$	—		$	—		$	—

Balance Sheet Data
Cash and cash equivalents	$	49,517		$	37,523		$	43,350		$	43,560		$	38,629
Total assets		839,935			786,389			657,412			567,199			406,119
Total debt		472,919			465,786			369,524			355,767			237,239
Stockholders’ equity		227,435			188,231			156,517			120,301			95,103

(a)	Includes casino, food and beverage, hotel and other expenses.

(b)	Relates to the Suncoast, which opened September 2000.

(c)	Includes interest income of (dollars in thousands) $450 (1999), $470 (2000), $405 (2001), $58 (2002) and $36 (2003) and capitalized interest of $612 (1999), $4,511 (2000), $1,048 (2001), $2,950 (2002) and $1,250 (2003).

(d)

In connection with the repurchase of certain debt, Coast Casinos incurred repurchase premiums of approximately $31.0 million. The repurchase premiums and the write-offs of unamortized debt issuance costs and original issue discount resulted in an extraordinary loss of approximately $41.6 million in 1999. In April 2002, the Financial Accounting Standards Board issued Statement No. 145, Rescission of FASB Statements Nos. 4, 44 and 64 and Amendment of FASB Statement No. 13. SFAS 145 addresses the presentation for losses on early retirements of debt in the statement of operations. Due to the adoption of SFAS 145, Coast Casinos will not present losses on early retirements of debt as an extraordinary item. Additionally, the 1999 extraordinary loss has been reclassified to conform to this new presentation.

Selected Unaudited Pro Forma Condensed Combined Financial Data

The following selected unaudited pro forma condensed combined financial data gives effect to the acquisition of the Red River Entertainment of Shreveport Partnership in Commendam, which is referred to as the “Shreveport Partnership” and which is further described under “—Recent Developments Relating to Boyd Gaming,” and the merger. The pro forma adjustments are based upon available information and assumptions that each company’s management believes are reasonable. The selected unaudited pro forma condensed combined financial data are presented for illustrative purposes only. The companies may have performed differently had they always been combined. Stockholders should not rely on this information as being indicative of the historical results that would have been achieved had the companies always been combined or the future results that the combined company will experience after the merger. The selected unaudited pro forma condensed combined financial data (i) have been derived from and should be read in conjunction with the unaudited pro forma condensed combined financial statements and accompanying notes included in this joint proxy statement/prospectus as described under “Unaudited Pro Forma Condensed Combined Financial Statements” beginning on page 85 and (ii) should be read in conjunction with the consolidated financial statements of Boyd Gaming and Coast Casinos incorporated by reference in this joint proxy statement/prospectus. See Chapter IV—Additional Information beginning on page 147.


	As of and for the Year Ended December 31, 2003
	(dollars in thousands, except for per share amounts)
Pro Forma Condensed Combined Statement of Operations Data
Net revenues	$	2,022,687
Operating income		276,188
Interest expense, net		120,218
Income before provisions for income taxes		146,473
Provision for income taxes		57,111
Net income		89,362

Pro forma net income per common share:
Basic	$	1.07
Diluted		1.04

Cash dividends per common share	$	0.15

Pro Forma Condensed Combined Balance Sheet Data
Total assets	$	3,548,598
Long-term debt (excluding current maturities)		2,314,809
Stockholders’ equity		762,177

Comparative Per Share Information

The following tables set forth historical per share information of Boyd Gaming and Coast Casinos and unaudited pro forma condensed combined per share information after giving effect to the merger under the purchase method of accounting, based on an average price per share of Boyd Gaming common stock of $16.767. The unaudited pro forma condensed combined per share information is derived from, and should be read in conjunction with, the unaudited pro forma condensed combined financial statements and accompanying notes included in this joint proxy statement/prospectus as described under “Unaudited Pro Forma Condensed Combined Financial Statements” beginning on page 85. The historical per share information is derived from the audited financial statements as of and for the year ended December 31, 2003 for each of Boyd Gaming and Coast Casinos.

Stockholders should read the information below in conjunction with the financial statements and accompanying notes of Boyd Gaming and Coast Casinos contained in the annual reports and other information that has been filed with the SEC and incorporated by reference in this joint proxy statement/prospectus and with the unaudited pro forma condensed combined financial statements referred to above. See Chapter IV—Additional Information beginning on page 147.


	For the Year Ended December 31, 2003
	Historical Per Share		Pro Forma Per Share
Boyd Gaming:
Net income per common share:
Basic	$	0.64	$	1.07
Diluted	$	0.62	$	1.04
Book value per common share	$	6.79	$	9.06
Cash dividends declared per common share	$	0.15	$	0.15
Shares outstanding at December 31, 2003		64,980,970

Coast Casinos:
Net income per common share:
Basic	$	30.33	$	35.10
Diluted	$	29.78	$	34.11
Book value per common share	$	155.65	$	297.19
Cash dividends declared per common share	$	3.50	$	4.92
Shares outstanding at December 31, 2003		1,461,178

Combined Company (with 40% of the aggregate merger consideration paid in stock):
Net income per common share:
Basic			$	1.07
Diluted			$	1.04
Book value per common share			$	9.06
Cash dividends declared per common share			$	0.15
Shares outstanding at December 31, 2003				84,153,103

Comparative Per Share Market Price and Dividend Information

Boyd Gaming common stock is listed for trading on the New York Stock Exchange under the symbol “BYD.” The following table sets forth, for the periods indicated, dividends and the high and low sale prices per share of Boyd Gaming common stock on the New York Stock Exchange Composite Transactions Tape. For current price information, you should consult publicly available sources. For more information on Boyd Gaming’s payment of dividends, see “—Dividend Policies.”


	Boyd Gaming Common Stock
	High		Low		Dividends Paid
2002
First Quarter	$	15.12	$	6.10		—
Second Quarter	$	16.85	$	11.39		—
Third Quarter	$	19.20	$	12.00		—
Fourth Quarter	$	18.80	$	11.00		—
2003
First Quarter	$	14.76	$	11.13		—
Second Quarter	$	17.39	$	12.35		—
Third Quarter	$	18.40	$	14.60	$	0.075
Fourth Quarter	$	17.00	$	13.12	$	0.075
2004
First Quarter (through March 26, 2004)	$	22.94	$	15.74	$	0.075

The following table sets forth the high and low sale prices per share of Boyd Gaming common stock on February 2, 2004, the day before Boyd Gaming and Coast Casinos entered into a confidentiality agreement, February 6, 2004, the last full trading day prior to the public announcement of the merger, and March 26, 2004, the last trading day that this information could be calculated prior to the date of this joint proxy statement/prospectus:


	Boyd Gaming Common Stock
	High		Low
February 2, 2004	$	16.67	$	16.18
February 6, 2004	$	19.28	$	18.25
March 26, 2004	$	22.94	$	22.61

Coast Casinos common stock is not publicly traded. In the opinion of Coast Casinos management, due to a lack of any market for shares of Coast Casinos common stock, transactions in Coast Casinos common stock of which Coast Casinos is aware are not frequent enough to constitute representative prices.

Recent Developments Relating to Boyd Gaming

On January 20, 2004, Boyd Gaming entered into a definitive agreement to acquire all of the outstanding limited and general partnership interests of the Shreveport Partnership, the partnership that owns Harrah’s Shreveport Hotel and Casino in Shreveport, Louisiana. Boyd Gaming will acquire the Shreveport Partnership interests for approximately $190.0 million in cash. Boyd Gaming expects the transaction to close during the second quarter of 2004, subject to receipt of regulatory approval.

Recent Developments Relating to Coast Casinos

Coast Casinos owns approximately 60 acres of land located in a gaming enterprise district on Las Vegas Boulevard South, adjacent to Interstate 15 and approximately six miles south of Tropicana Avenue. Subject to market conditions, availability of financing and receipt of required governmental approvals, Coast Casinos intends to develop a hotel-casino, the “South Coast,” on this site. Coast Casinos is currently developing plans for the project and anticipates beginning construction in the second quarter of 2004 and opening in the second half of 2005.

RISK FACTORS

Boyd Gaming stockholders and Coast Casinos stockholders should read carefully this joint proxy statement/prospectus and the other documents attached to or incorporated by reference in this joint proxy statement/prospectus. Boyd Gaming stockholders and Coast Casinos stockholders should, in particular, read and consider the following risk factors:

Risks Relating to the Merger

Stock consideration or cash consideration paid in the merger may be different than what Coast Casinos stockholders elect.

Coast Casinos stockholders making elections for stock consideration may not receive what they elect. The aggregate number of shares of Boyd Gaming common stock to be issued in the merger to minority stockholders may not exceed approximately 1,009,194 shares (subject to the rounding mechanics of the proration provisions of the merger agreement), as that number may be adjusted in accordance with the terms of the merger agreement in order to qualify the merger as a reorganization within the meaning of Section 368(a) of the Internal Revenue Code, and the aggregate amount of cash to be paid in the merger to minority stockholders may not exceed approximately $336,170,276.20 (subject to the rounding mechanics of the proration provisions of the merger agreement), as that number may be adjusted in accordance with the terms of the merger agreement in order to qualify the merger as a reorganization within the meaning of Section 368(a) of the Internal Revenue Code. If shares of Boyd Gaming common stock are oversubscribed by Coast Casinos stockholders, a minority stockholder who elected to receive shares of Boyd Gaming common stock may receive a substantial part of his or her consideration in the form of cash. If cash is oversubscribed by Coast Casinos stockholders, a minority stockholder who elected to receive cash may receive part of his or her consideration in the form of shares of Boyd Gaming common stock. For a full description of the proration terms and procedures, see “The Merger Agreement—Consideration to be Received in the Merger—Adjustments to the Merger Consideration and Proration.”

Delay in regulatory approvals will delay and possibly prevent the merger.

The consummation of the merger is conditioned upon receiving approval from various governmental regulatory authorities, including approval by the Nevada State Gaming Control Board, the Nevada Gaming Commission, the Clark County Liquor and Gaming Licensing Board and the City of Las Vegas, as well as regulatory authorities in the other jurisdictions in which Boyd Gaming operates. In addition, the merger is conditioned upon the expiration or termination of the applicable waiting period under the HSR Act, early termination of which was granted by the Federal Trade Commission, effective as of March 17, 2004.

While Boyd Gaming and Coast Casinos expect to obtain the required regulatory approvals within three months from the date of this joint proxy statement/prospectus, Boyd Gaming and Coast Casinos cannot be certain that all of the required approvals will be obtained, nor can they be certain that the approvals will be obtained within the time contemplated by the merger agreement. A delay in obtaining the required approvals will delay and possibly prevent the consummation of the merger. In addition, Boyd Gaming and Coast Casinos may obtain the required approvals, but with terms or conditions that have a material adverse effect on Boyd Gaming or Coast Casinos. Boyd Gaming is not obligated under the merger agreement to take specified actions, including disposing any of its assets or limiting its freedom of action with respect to any of its businesses, in order to obtain any consents, approvals, permits or authorizations or to remove any impediments to the merger relating solely to the HSR Act or other antitrust regulations. If, as a result of any such inaction on the part of Boyd Gaming, any necessary consent or approval is not obtained, each of Boyd Gaming and Coast Casinos will have the right to terminate the merger agreement. See “The Merger Agreement—Termination.”

For a description of the governmental approvals necessary to consummate the merger, see “The Merger—Governmental and Regulatory Matters.”

Failure of the merger to qualify as a reorganization within the meaning of Section 368(a) of the Internal Revenue Code may lead to the termination of the merger agreement.

Boyd Gaming and Coast Casinos intend for the merger to qualify as a reorganization within the meaning of Section 368(a) of the Internal Revenue Code. For a full description of the tax consequences of the merger for Coast Casinos stockholders, see “The Merger—U.S. Federal Income Tax Consequences of the Merger.” In order to comply with the requirements that must be satisfied in order for the merger to qualify as a reorganization within the meaning of Section 368(a) of the Internal Revenue Code, the merger agreement provides that, if the aggregate value of the stock consideration in the merger, as a result of a decline in the sale price of a share of Boyd Gaming common stock between the date of the merger agreement and the anticipated closing date of the merger, would be less than 40% of the aggregate value of all merger consideration, with the shares of Boyd Gaming common stock being valued as of the anticipated closing date, then the aggregate amount of stock consideration that minority stockholders receive in the merger would increase and the aggregate amount of cash consideration that minority stockholders receive in the merger would decrease, in each case in an amount sufficient to provide that, on the closing date of the merger, 40% of the aggregate amount of all merger consideration, including consideration offered to Coast Casinos stockholders other than minority stockholders, will consist of shares of Boyd Gaming common stock.

If, as a result of a decline in the sale price of a share of Boyd Gaming common stock between the date of the merger agreement and the anticipated closing date of the merger, the number of shares of Boyd Gaming common stock required to be issued in the merger to minority stockholders to ensure tax-free reorganization treatment exceeds 7,837,077 shares of Boyd Gaming common stock, then Boyd Gaming will have the right to terminate the merger agreement. For a full description of the adjustment of merger consideration for tax reasons, including a description of Boyd Gaming’s right to terminate the merger agreement, see “The Merger Agreement—Consideration to be Received in the Merger—Adjustments to the Merger Consideration and Proration” and “The Merger Agreement—Termination.”

Boyd Gaming will have more indebtedness after the merger, which could adversely affect its cash flows and business.

In order to complete the merger, Boyd Gaming anticipates arranging for and funding at least $1.0 billion of new financing, which is referred to as the “Financing.” Proceeds from the Financing will be used to fund the cash portion of the consideration to the Coast Casinos stockholders as well as refinance substantially all of Coast Casinos’ existing indebtedness.

Boyd Gaming’s debt outstanding as of December 31, 2003 was approximately $1.1 billion. Giving effect to the acquisition of the Shreveport Partnership and the merger, Boyd Gaming’s pro forma total debt outstanding as of December 31, 2003 would have been approximately $2.3 billion. As a result of this increase in debt, demands on Boyd Gaming’s cash resources will increase after the consummation of the merger. The increased levels of debt could, among other things:

•

require Boyd Gaming to dedicate a substantial portion of its cash flow from operations to payments on its debt, thereby reducing funds available for working capital, capital expenditures, dividends, acquisitions and other purposes;

•

increase Boyd Gaming’s vulnerability to, and limit flexibility in planning for, adverse economic and industry conditions;

•

create competitive disadvantages compared to other companies with lower debt levels; and

•

limit Boyd Gaming’s ability to apply proceeds from an offering or asset sale to purposes other than the repayment of debt.

In addition, Standard & Poor’s Rating Services placed Boyd Gaming’s senior secured and senior unsecured debt ratings on “CreditWatch” with negative implications, given the uncertainty about the composition of the final capital structure of Boyd Gaming following the consummation of the merger. Boyd Gaming’s corporate credit rating and subordinated debt ratings were affirmed, with a stable outlook. Moody’s Investor Services confirmed all of Boyd Gaming’s debt ratings. A credit rating is not a recommendation to buy, sell or hold securities and may be subject to revision or withdrawal at any time by the assigning rating organization. Changes to Boyd Gaming’s business and the incurrence of additional indebtedness in the future could cause further downgrading of Boyd Gaming’s credit rating, which could have a material adverse effect on Boyd Gaming’s business, financial condition and results of operations as well as on the ability of Boyd Gaming to raise additional indebtedness.

Successful integration of the businesses of Boyd Gaming and Coast Casinos is not assured.

If the merger is completed, Coast Casinos will become a wholly owned subsidiary of Boyd Gaming. Integrating and coordinating the operations and personnel of Boyd Gaming and Coast Casinos will involve complex operational and personnel-related challenges. This process will be time-consuming and expensive and may disrupt the business of either or both of the companies and may not result in the full benefits expected by Boyd Gaming. The difficulties, costs and delays that could be encountered include:

•

unanticipated issues in integrating information, communications and other systems;

•

difficulties attracting and retaining key personnel;

•

loss of customers; and

•

unanticipated incompatibility of purchasing, logistics, marketing and administration methods.

Risks Relating to Boyd Gaming’s Operations After the Consummation of the Merger

Intense competition exists in the gaming industry and Boyd Gaming expects competition to continue to intensify.

The gaming industry is highly competitive. If other properties operate more successfully, if existing properties are enhanced or expanded, or if additional hotels and casinos are established in and around the locations in which Boyd Gaming conducts business, Boyd Gaming may lose market share. In particular, the expansion of casino gaming in or near any geographic area from which Boyd Gaming attracts or expects to attract a significant number of its customers could have a material adverse effect on Boyd Gaming’s business, financial condition and results of operations.

Boyd Gaming also competes with legalized gaming from casinos located on Native American tribal lands. A proliferation of Native American gaming in California, or a proliferation of Native American gaming in other areas located near Boyd Gaming’s properties, could have a material adverse effect on Boyd Gaming’s operating results in those markets.

In Michigan, the Pokagon Band of Potawatomi Indians, a federally recognized Native American tribe, announced, in 1994, its intention to construct a land-based gaming operation in or near the City of New Buffalo, Michigan, which is located less than fifteen miles from Boyd Gaming’s Blue Chip Casino, which is located in Michigan City, Indiana and referred to as “Blue Chip.” Although the Pokagons have legal and regulatory issues that must be resolved prior to construction of the proposed gaming facility, if their facility is constructed and begins operations, it could have a material adverse effect on the operations of Blue Chip.

The casinos owned and being developed by Boyd Gaming compete, and will in the future compete, with all forms of existing legalized gaming and with any new forms of gaming that may be legalized in the future. Additionally, Boyd Gaming faces competition from all other types of entertainment.

The consummation of the merger may raise union organization rights under certain of Boyd Gaming’s and Coast Casinos’ collective bargaining agreements.

Three of Boyd Gaming’s operating subsidiaries, the Stardust, the Fremont and Main Street Station, as well as the Barbary Coast Hotel and Casino owned by Coast Hotels, are parties to collective bargaining agreements with the Local Joint Executive Board of Las Vegas, which is referred to as the “Union,” and which is affiliated with the Hotel and Restaurant Employees International Union. Boyd Gaming representatives have been informed by officials of the Union that it believes that it will have certain union organization rights at the non-union properties of Coast Casinos, which include The Orleans, the Gold Coast and the Suncoast, upon the consummation of the merger. Boyd Gaming and Coast Casinos believe this claim of the Union has no merit. However, the potential exists for disputes in connection with the Union’s claims.

Failure to achieve the anticipated benefits of Boyd Gaming’s proposed acquisition of the Shreveport Partnership could adversely impact Boyd Gaming’s business.

In January 2004, Boyd Gaming announced that it had agreed to acquire the Shreveport Partnership. The complex process of integrating the Shreveport Partnership into Boyd Gaming will require significant resources. Failure to achieve the anticipated benefits from the acquisition of the Shreveport Partnership or to successfully integrate the operations of the Shreveport Partnership could have a material adverse effect on Boyd Gaming’s business, financial condition and results of operations.

Boyd Gaming will incur significant costs and commit significant management time integrating the Shreveport Partnership’s operations, information, communication and other systems and personnel, among other items. This integration will cause Boyd Gaming to incur cash outflows in completing the integration process, such as:

•

fees and expenses of professionals and consultants involved in completing the integration process;

•

settling existing liabilities of the acquired businesses;

•

integrating technology and personnel; and

•

other transaction costs associated with the acquisition, including financial advisor, attorney, accountant and other fees.

We expect the acquisition of the Shreveport Partnership to close in the second quarter of 2004. However, because the consummation of the acquisition of the Shreveport Partnership is subject to closing conditions, the acquisition of the Shreveport Partnership may not close at such time, or at all.

If the action filed against Boyd Gaming’s Delta Downs property proceeds to trial and Boyd Gaming is not ultimately successful in defending against such action, Boyd Gaming’s business, financial condition and results of operations could be materially adversely affected.

On October 29, 2001, Harrah’s of Lake Charles, LLC (formerly the Players Lake Charles, LLC), Harrah’s Star Partnership (formerly the Showboat Star Partnership) and several individuals, collectively, the plaintiffs, filed suit in state district court in Calcasieu Parish, Louisiana, against DDRA Capital, Inc. (the former owner of Delta Downs Racetrack and Casino, which is located in Vinton, Louisiana and referred to as “Delta Downs”), the Calcasieu Parish Police Jury and Boyd Racing, L.L.C., the entity that owns and operates Delta Downs, seeking to revoke the building permit that the Calcasieu Parish Police Jury granted to Boyd Gaming for its construction and renovation at Delta Downs. Specifically, the plaintiffs claim that Boyd Gaming’s construction and renovation at Delta Downs exceeds the square foot specifications that were approved by the Calcasieu Parish Police Jury, and that the number of slot machines that Boyd Gaming was approved to operate at Delta Downs exceeds the number which the former owner previously represented, in connection with the Calcasieu Parish Slot Machine Gaming Referendum, would be operated at the facility. On December 7, 2001, Boyd Gaming responded to the plaintiffs’ complaint claiming, among other things, that their complaint failed to state a cause of action for which relief

could be sought and that the statute of limitations on their action had lapsed. On February 11, 2002, the plaintiffs amended their complaint to eliminate certain defendants from the action. On March 1, 2002, the state district court approved Harrah’s motion to voluntarily dismiss the Calcasieu Parish Police Jury from the action, leaving DDRA and Boyd Racing, L.L.C. as the defendants. On March 26, 2002, Boyd Gaming filed a response to plaintiffs’ amended complaint. To date, no trial date has been set on this action. Boyd Gaming believes this lawsuit is without merit and Boyd Gaming intends to defend the suit vigorously. In connection with Boyd Gaming’s pending acquisition of the Shreveport Partnership, Harrah’s has agreed to dismiss this matter upon completion of the transaction.

If Harrah’s does not dismiss this matter and if such action proceeds to trial, Boyd Gaming may not be successful in defending against the action. In the event the claim seeking to revoke Boyd Gaming’s building permit at Delta Downs is ultimately successful, Boyd Gaming would have to reduce both the number of slot machines it operates and the size of the casino at Delta Downs. In addition, if such action is ultimately successful at trial, it would materially affect Boyd Gaming’s cash flow from Delta Downs, would reduce the value of the Delta Downs acquisition and could have a material adverse effect on Boyd Gaming’s business, financial condition and results of operations.

If Boyd Gaming is unable to finance its expansion and renovation projects as well as capital expenditures through cash flow and borrowings under its bank credit facility, Boyd Gaming may be forced to limit or suspend its expansion and renovation efforts.

Boyd Gaming intends to finance its current and future expansion and renovation projects, including the continuing construction of Coast Casinos’ South Coast project, primarily with cash flow from operations and borrowings under its refinanced bank credit facility. Boyd Gaming could also obtain additional equity or debt financing for its projects. If Boyd Gaming is unable to finance such projects in this manner, it will have to adopt one or more alternatives, such as reducing or delaying planned expansion, development and renovation projects as well as capital expenditures, selling assets, restructuring debt or obtaining additional equity financing or joint venture partners, or modifying its bank credit facility. These sources of funds may not be sufficient to finance Boyd Gaming’s expansion, and other financing may not be available on acceptable terms, in a timely manner or at all. In addition, Boyd Gaming’s existing indebtedness contains certain restrictions on its ability to incur additional indebtedness. If Boyd Gaming is unable to secure additional financing, it could be forced to limit or suspend expansion and renovation projects, which could have a material adverse effect on Boyd Gaming’s business, financial condition and results of operations.

The development and construction of new hotels, casinos and gaming venues and the expansion of existing ones are susceptible to delays, cost overruns and other uncertainties, which could have an adverse effect on Boyd Gaming’s business, financial condition and results of operations.

Boyd Gaming may decide to develop, construct and open new hotels, casinos and other gaming venues in response to opportunities that may arise. If the merger is consummated, Boyd Gaming will also continue to develop the projects that are currently being undertaken by Coast Casinos. For example, Coast Casinos is currently developing plans for the South Coast project and anticipates beginning construction of the hotel-casino in the first half of 2004 and opening in the second half of 2005. Coast Casinos is also undertaking the construction of a new hotel tower at The Orleans. The development and construction of new hotels, casinos and gaming venues and the expansion of existing ones are susceptible to various risks and uncertainties, such as:

•

the existence of acceptable market conditions and demand for the completed project;

•

the development of plans and budgets that are consistent with Boyd Gaming’s available financial resources;

•

general construction risks, including cost overruns, shortages of equipment, materials or skilled labor, labor disputes, unforeseen environmental, engineering or geological problems, work stoppages, fire and other natural disasters, construction scheduling problems and weather interferences;

•

change orders and plan or specification modification;

•

changes and concessions required by governmental or regulatory authorities;

•

delays in obtaining or inability to obtain all licenses, permits and authorizations required to complete the project; and

•

disruption to Boyd Gaming’s existing operations and facilities.

Boyd Gaming’s failure to complete any new development or expansion project as planned, on schedule, within budget and in a manner that generates anticipated profits could have a material adverse effect on Boyd Gaming’s business, financial condition and results of operations.

Boyd Gaming is subject to extensive governmental gaming regulation and taxation policies, the enforcement of which may have a material adverse effect on Boyd Gaming’s business, financial condition and results of operations.

Boyd Gaming is subject to a variety of regulations in the jurisdictions in which it operates. Regulatory authorities at the U.S. Federal, state and local levels have broad powers with respect to the licensing of casino operations and may revoke, suspend, condition or limit Boyd Gaming’s gaming or other licenses, impose substantial fines and take other actions, any one of which could have a material adverse effect on Boyd Gaming’s business, financial condition and results of operations.

If additional gaming regulations are adopted in a jurisdiction in which Boyd Gaming operates, such regulations could impose restrictions or costs that could have a material adverse effect on Boyd Gaming. From time to time, various proposals are introduced in the legislatures of some of the jurisdictions in which Boyd Gaming has existing or planned operations that, if enacted, could adversely affect the tax, regulatory, operational or other aspects of the gaming industry and Boyd Gaming. Legislation of this type may be enacted in the future. The U.S. Federal government has also previously considered a U.S. Federal tax on casino revenues and may consider such a tax in the future. In addition, gaming companies are currently subject to significant state and local taxes and fees in addition to normal U.S. Federal and state corporate income taxes, and such taxes and fees are subject to increase at any time. For example, on July 1, 2002, pursuant to new legislation in Indiana, the gaming tax rate was increased from 20% to 22.5% for those riverboats that conduct excursions or cruises. On August 1, 2002, upon the approval of dockside gaming by the Indiana Gaming Commission and the commencement of dockside operations by Boyd Gaming’s Blue Chip riverboat casino, the gaming tax rate changed from a flat tax of 22.5% to a graduated tax, with a minimum tax rate of 15% and a maximum tax rate of 35% based on the amount of Blue Chip’s adjusted gross receipts in Indiana’s fiscal year. In May 2003, pursuant to additional legislation enacted in Indiana, the graduated tax was changed retroactively to July 1, 2002, the first day of the State’s fiscal year, instead of the date on which dockside operations commenced for the applicable riverboat. For those Indiana riverboats, including Blue Chip, that commenced dockside operations, the calculation of the admission tax was modified to count customers on a per entry basis as opposed to a per cruise basis. In addition, effective July 1, 2003, Boyd Gaming became subject to additional taxes on all rooms provided on a complimentary basis to Boyd Gaming’s Blue Chip customers. In addition, on both July 1, 2002 and 2003, Par-A-Dice Hotel and Casino, which is located in East Peoria, Illinois and referred to as “Par-A-Dice,” began paying higher gaming taxes pursuant to new legislation in Illinois. If other states adopt similar legislation, or if there is any material increase in state and local taxes and fees, Boyd Gaming’s business, financial condition and results of operations could be materially adversely affected. See “The Merger—Governmental and Regulatory Matters—Gaming Regulation.”

Boyd Gaming’s directors, officers and key employees must also be approved by certain state regulatory authorities. If state regulatory authorities were to find a person occupying any such position unsuitable, Boyd Gaming would be required to sever its relationship with that person. Certain public and private issuances of securities and certain other transactions by Boyd Gaming also require the approval of certain state regulatory authorities.

Riverboats and dockside facilities are subject to risks relating to weather or mechanical failure and must comply with applicable regulations.

Gaming operations conducted on riverboat casinos or at dockside facilities could be lost from service for a variety of reasons, including casualty, forces of nature, mechanical failure or extended or extraordinary maintenance.

Boyd Gaming’s riverboats must comply with U.S. Coast Guard requirements as to boat design, on-board facilities, equipment, personnel and safety. Each riverboat must hold a Certificate of Inspection or must be approved by the American Bureau of Shipping for stabilization and flotation, and may also be subject to local zoning and building codes. The U.S. Coast Guard requirements establish design standards, set limits on the operation of the vessels and require individual licensing of all personnel involved with the operation of the vessels. Loss of a vessel’s Certificate of Inspection or American Bureau of Shipping approval would preclude its use as a casino.

U.S. Coast Guard regulations require a hull inspection for all riverboats at five-year intervals. Under certain circumstances, extensions may be approved. The U.S. Coast Guard may require that such hull inspections be conducted at a U.S. Coast Guard-approved dry-docking facility, and if so required, the travel to and from such docking facility, as well as the time required for inspections of the Treasure Chest Casino, which is located in Kenner, Louisiana, Par-A-Dice and Blue Chip riverboats, as well as those riverboats to be acquired in connection with the acquisition of the Shreveport Partnership, could be significant. To date, the U.S. Coast Guard has allowed in-place inspections of some of Boyd Gaming’s riverboats. The U.S. Coast Guard may not allow these types of inspections in the future. The loss of a dockside casino or riverboat casino from service for any period of time could have a material adverse effect on Boyd Gaming’s business, financial condition and results of operations.

On October 22, 2003, the U.S. Coast Guard finalized regulations for implementing maritime security under the Maritime Transportation Security Act. The new maritime security regulations require Boyd Gaming to prepare security plans, perform vulnerability assessments, designate a Company Security Officer, Vessel Security Officers and Facility Security Officers, and provide training for all of Boyd Gaming’s employees on emergency preparedness and security issues aboard Boyd Gaming’s riverboat casinos and at their respective dockside facilities. The new regulations require Boyd Gaming to be in full compliance on July 1, 2004. The new regulations include provisions for using Coast Guard approved alternative security programs to comply with these regulations. The American Gaming Association has an approved Alternative Security Program, and Boyd Gaming has reported to the Coast Guard that Boyd Gaming is using the American Gaming Association’s Alternative Security Program at its riverboat casinos and dockside facilities. The American Gaming Association’s Alternative Security Program is specifically designed to address riverboat casinos’ and their respective dockside facilities’ maritime security requirements. The implementation of these regulations could have a material adverse effect on Boyd Gaming’s business, financial condition and results of operations.

Boyd Gaming draws a significant percentage of its customers from limited geographic regions. Events adversely impacting the economy or these regions, including terrorism, may also impact Boyd Gaming’s business.

The California Hotel and Casino, which is located in Las Vegas, Nevada and referred to as the “California,” the Fremont Hotel and Casino, which is located in Las Vegas, Nevada and referred to as the “Fremont,” and the Main Street Station Hotel, Casino and Brewery, which is located in Las Vegas, Nevada and referred to as “Main Street Station,” draw a substantial portion of their customers from the Hawaiian market. For the year ended December 31, 2003, patrons from Hawaii comprised approximately 68% of the room nights sold at the California, 60% at the Fremont and 54% at Main Street Station. An increase in fuel costs or transportation prices, a decrease in airplane seat availability, or a deterioration of relations with tour and travel agents, particularly as they affect travel between the Hawaiian market and Boyd Gaming’s facilities, could have a material adverse effect on Boyd Gaming’s business, financial condition and results of operations.

Boyd Gaming’s Las Vegas properties, including the properties of Coast Casinos that would be acquired in the merger, also draw a substantial number of customers from certain other specific geographic areas, including Southern California, Arizona, Las Vegas and the Midwest. With the amendment of the California Constitution, Native American casinos may divert potential visitors away from Nevada, which could negatively affect Nevada gaming markets. In addition, due to Boyd Gaming’s significant concentration of properties in Nevada, any terrorist activities or disasters in or around Nevada could have a material adverse effect on Boyd Gaming’s business, financial condition and results of operations. Each of Boyd Gaming’s other properties located outside of Nevada depends primarily on visitors from their respective surrounding regions. The outbreak of public health threats, or the perception that such threats exist, at any of Boyd Gaming’s properties as well as adverse economic conditions that affect the economy of any of these regions, including those resulting from war, terrorist activities or other geopolitical conflict, could have a material adverse effect on Boyd Gaming’s business, financial condition and results of operations.

In addition, to the extent that the airline industry is negatively impacted due to the outbreak of war, public health threats, terrorist or similar activity, increased security restrictions or the public’s general reluctance to travel by air, Boyd Gaming’s business, financial condition and results of operations could be materially adversely affected.

Energy price increases may adversely affect Boyd Gaming’s cost of operations and revenues.

Boyd Gaming’s casino properties use significant amounts of electricity, natural gas and other forms of energy. In addition, our Hawaiian air charter operation uses a significant amount of jet fuel. While no shortages of energy or fuel have been experienced to date, the substantial increases in energy prices in the United States have negatively affected and may continue to negatively affect Boyd Gaming’s operating results. The extent of the impact is subject to the magnitude and duration of the energy or fuel price increases, but this impact could be material. In addition, energy and gasoline price increases in cities that constitute a significant source of customers for Boyd Gaming’s properties could result in a decline in disposable income of potential customers and a corresponding decrease in visitation and spending at Boyd Gaming’s properties, which would negatively impact revenues.

The Boyd family owns a controlling interest in Boyd Gaming’s capital stock and may significantly influence Boyd Gaming’s affairs.

William S. Boyd, the Chairman and Chief Executive Officer of Boyd Gaming, together with his immediate family, beneficially owned approximately 46% of the outstanding shares of Boyd Gaming common stock as of December 31, 2003, and immediately following the consummation of the merger, the Boyd family will own approximately 37% of the outstanding shares of Boyd Gaming common stock. As a result, the Boyd family has the ability to significantly influence Boyd Gaming’s affairs, including the election of Boyd Gaming’s directors and, except as otherwise provided by law, the approval or disapproval of other matters submitted to a vote of Boyd Gaming stockholders, including a merger, consolidation or sale of assets.

Additional Risks Relating to Coast Casinos’ Operations

Coast Casinos faces significant risks in financing, developing, constructing and opening the South Coast project, which could significantly affect its business strategy and have a material adverse effect on its business, financial condition and results of operations.

A key element of Coast Casinos’ business strategy is the development and construction of the South Coast hotel-casino. In developing and constructing the South Coast project, Coast Casinos faces significant risks and uncertainties. For example, Coast Casinos currently expects the development and construction of the South Coast project to cost approximately $350.0 million. Coast Casinos has not arranged financing to fund the South Coast development. Even if Coast Casinos, or the surviving corporation after the effective time of the merger, is able to obtain the necessary financing, Boyd Gaming and Coast Casino cannot assure their respective stockholders that the South Coast project will be completed as planned, on schedule or within budget, if at all, or that it will

generate anticipated profits. Furthermore, Coast Casinos has not yet completed the plans and specifications for the South Coast project, so actual development and construction costs may be higher than it currently expects. Coast Casinos’ failure to successfully develop, construct and open the South Coast project could significantly affect its business strategy and have a material adverse effect on its business, financial condition and results of operations. See also “—Risks Relating to Boyd Gaming’s Operations After the Consummation of the Merger—If Boyd Gaming is unable to finance its expansion and renovation projects as well as capital expenditures through cash flow and borrowings under its bank credit facility, Boyd Gaming may be forced to limit its expansion and renovation efforts.”

Most of Coast Casinos’ hotel-casinos are located on leased property. If it defaults on any of these leases, the lessor could terminate the lease and Coast Casinos may lose possession of the hotel-casino.

Coast Casinos leases the land on which The Orleans, the Suncoast and the Barbary Coast are located. If Coast Casinos were to default on any lease, the lessor could terminate the lease and Coast Casinos could lose possession of the affected land and any improvements on the land, including the hotel-casinos. This would have a significant negative impact on Coast Casinos as it would then be unable to operate The Orleans, the Suncoast or the Barbary Coast.

FORWARD-LOOKING STATEMENTS MAY PROVE INACCURATE

Certain statements and assumptions in this joint proxy statement/prospectus and in the documents attached or incorporated by reference in this joint proxy statement/prospectus contain or are based on “forward-looking” information and involve risks and uncertainties. Boyd Gaming and Coast Casinos believe that such statements are “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. These statements include those that may predict, forecast, indicate or imply future results, performance or achievements. Such forward-looking information also includes, among other things, statements as to the expected benefits of the merger to Boyd Gaming stockholders and Coast Casinos stockholders, statements as to the impact of the proposed merger on revenues and earnings, and other statements with respect to the financial condition, results of operations, business strategies, operating efficiencies or synergies, competitive positions, growth opportunities, plans and objectives of management and other matters. These statements are subject to numerous assumptions and uncertainties, many of which are outside of Boyd Gaming’s and Coast Casinos’ control and involve risks and uncertainties that could cause actual results to differ materially from the results contained in the forward-looking statements. These include completion of the merger, governmental regulatory processes and assumptions with respect to future revenues, expected operating performance and cash flows.

Actual outcomes are dependent upon many factors. Important factors that could cause actual results to differ materially from those suggested by the forward-looking statements include, among others, the “Risk Factors” set forth above as well as the following factors:

•

the possibility that the companies will be unable to fully realize the benefits they anticipate from the merger;

•

the possibility that the merger may not occur or that Boyd Gaming and Coast Casinos may be required to modify some aspect of the merger or their businesses to obtain regulatory approvals;

•

the combined company’s continued ability to execute its business strategy;

•

changes in general economic conditions, both domestically and abroad;

•

the effect of various litigation that arise from time to time in the ordinary course of business;

•

changes in the banking and capital markets, which can affect the cost of financing activities;

•

the impact of weather and the occurrence of natural disasters such as fires, floods and other catastrophic events and natural disasters;

•

acts of war or terrorist activities; and

•

other economic, political and technological risks and uncertainties.

Words such as “anticipates,” “believes,” “estimates,” “expects,” “intends,” “plans,” “hopes,” “targets” or similar expressions are intended to identify forward-looking statements, which speak only as of the date of this joint proxy statement/prospectus, and in the case of documents incorporated by reference, as of the date of those documents. Boyd Gaming and Coast Casinos operate in an unpredictable and competitive environment. It is not possible to predict all risk factors or estimate the impact of these factors. Accordingly, stockholders should not place undue reliance on the forward-looking statements as a prediction of future results. Neither Boyd Gaming nor Coast Casinos undertakes any obligation to update or release any revisions to any forward-looking statements or to report any events or circumstances after the date of this joint proxy statement/prospectus or to reflect the occurrence of unanticipated events, except as required by law.

THE MERGER

The discussion in this joint proxy statement/prospectus of the merger, including the issuance of shares of Boyd Gaming common stock in the merger, and the merger agreement is subject to, and is qualified in its entirety by reference to, the principal terms of the Agreement and Plan of Merger dated as of February 6, 2004, as amended, among Boyd Gaming, BGC, Inc. and Coast Casinos, a copy of which is attached to this joint proxy statement/prospectus as Annex A and is incorporated into this joint proxy statement/prospectus by reference.

General

Boyd Gaming, its direct wholly owned subsidiary BGC, Inc. and Coast Casinos have entered into a merger agreement pursuant to which Boyd Gaming will acquire Coast Casinos through a merger of Coast Casinos with and into BGC, Inc. At the effective time of the merger, Coast Casinos would become a direct wholly owned subsidiary of Boyd Gaming, and the holders of Coast Casinos common stock would be entitled to receive either $550 in cash or 32.8025 shares of Boyd Gaming common stock per share of Coast Casinos common stock, upon the terms and subject to adjustment and proration as provided in the merger agreement and further described below under “The Merger Agreement—Consideration to be Received in the Merger.”

Background of the Merger

General

From time to time, Coast Casinos has received inquiries regarding potential business combinations, including previous inquiries from Boyd Gaming over the last two years. Prior to the discussions with Boyd Gaming described below under “—Background of the Merger—Discussions,” none of the inquiries progressed beyond preliminary discussions. Most recently, in Fall 2003, Coast Casinos received an unsolicited proposal from an unaffiliated third party (other than Boyd Gaming) to acquire all of the outstanding shares of Coast Casinos common stock for $500 in cash per share of Coast Casinos common stock, which proposal was revised shortly thereafter to an offer of $550 in cash per share of Coast Casinos common stock. After considering a number of factors related to that proposal and the business, prospects and opportunities for Coast Casinos, the Coast Casinos board of directors voted to reject that proposal. However, the Coast Casinos board of directors was aware of the desire of certain Coast Casinos stockholders to liquidate some or all of their Coast Casinos stockholdings, and the Coast Casinos board of directors evaluated opportunities for providing its stockholders with greater liquidity than that currently afforded by an investment in Coast Casinos common stock. Among the opportunities discussed were a possible cash tender offer by Coast Casinos to its stockholders for a portion of the outstanding shares of Coast Casinos common stock and an initial public offering of the shares of Coast Casinos common stock.

Since its inception in 1988, Boyd Gaming and its predecessor companies have had a significant Nevada presence. For the last ten years, Boyd Gaming has focused its growth strategy outside of Nevada. Boyd Gaming grew in the riverboat and racetrack casino sectors in the Midwest and South, principally by acquisitions that were done at favorable prices. Boyd Gaming also developed a significant resort in Atlantic City, New Jersey that opened in the middle of 2003. This strategy enabled Boyd Gaming to become one of the most diversified gaming companies in the casino entertainment industry. In recent years, Boyd Gaming determined that it should refocus on Las Vegas, which had experienced dynamic growth in the past decade. Boyd Gaming decided to employ its substantial experience in acquiring, merging and integrating properties in its strategy to grow in Las Vegas. The Las Vegas locals sector, where Boyd Gaming had been operating successfully for 25 years with its Sam’s Town property, became the primary focus for Boyd Gaming’s Las Vegas growth and diversification strategy. Boyd Gaming believes that the merger with Coast Casinos will help Boyd Gaming create a significant presence in the Las Vegas locals sector while maintaining its position as one of the most diversified casino companies in the country.

Discussions

Over a year ago, William S. Boyd, Chairman and Chief Executive Officer of Boyd Gaming, arranged a meeting with Michael J. Gaughan, the Chairman and Chief Executive Officer of Coast Casinos, to explore the opportunities for a combination of the two companies. For a period of time, Messrs. Boyd and Gaughan and other members of senior management of the two companies maintained casual contact on the subject, but no substantive discussion ensued. Late in 2003, Mr. Boyd arranged another meeting, and on January 13, 2004, Mr. Boyd and Ellis Landau, Executive Vice President and Chief Financial Officer of Boyd Gaming, met with Mr. Gaughan and Harlan Braaten, President and Chief Operating Officer of Coast Casinos. At that meeting, the participants agreed to seriously explore a transaction that would lead to the combination of Boyd Gaming and Coast Casinos. At that meeting, the representatives from the two companies also discussed possible transaction structures and consideration.

Messrs. Boyd and Landau had several conversations with Messrs. Gaughan and Braaten over the next ten days regarding possible transactions, and on January 23, 2004, asked the legal advisors of Boyd Gaming and Coast Casinos, respectively, to discuss potential structures that would result in Boyd Gaming acquiring all or a substantial portion of the outstanding shares of Coast Casinos common stock.

Between January 24 through 26, 2004, Mr. Boyd and Mr. Landau held discussions with Cravath, Swaine & Moore LLP regarding the proposed acquisition by Boyd Gaming of Coast Casinos. The discussion topics included the composition of the potential consideration, possible merger structures and topics relating to the transaction process. One transaction structure that was proposed involved a stockholders agreement pursuant to which three of the stockholders of Coast Casinos who owned, in the aggregate, approximately 56% of the outstanding shares of Coast Casinos common stock would agree, as Coast Casinos stockholders, to vote their shares of Coast Casinos common stock in favor of a merger between Boyd Gaming and Coast Casinos and against any alternative transaction.

On January 25, 2004, Mr. Gaughan and Franklin Toti, a director and the Vice President of Casino Operations of Coast Casinos, met with Mr. Boyd to discuss possible terms of a stockholders agreement pursuant to which Messrs. Gaughan and Toti, along with possibly Jerry Herbst, a director and the Treasurer of Coast Casinos, would support, as Coast Casinos stockholders, a transaction between Boyd Gaming and Coast Casinos.

On January 26, 2004, Mr. Gaughan met with Mr. Herbst to advise him of the discussions with Boyd Gaming and of Boyd Gaming’s proposal of a stockholders agreement among Boyd Gaming and Messrs. Gaughan, Herbst and Toti.

Later in the day on January 26, 2004, at a regularly scheduled meeting of the Coast Casinos board of directors, Mr. Gaughan advised the Coast Casinos board of directors that he and Messrs. Herbst and Toti tentatively supported a combination between Coast Casinos and Boyd Gaming and were discussing with Boyd Gaming entering into an agreement pursuant to which they would agree, as Coast Casinos stockholders, to vote the shares of Coast Casinos common stock owned by them in favor of a merger transaction with Boyd Gaming in which the Coast Casinos stockholders would receive $550 per share in consideration consisting of Boyd Gaming common stock and cash. The Coast Casinos board of directors authorized Coast Casinos management to explore further the terms and conditions, as well as the potential benefits and risks, of a merger with Boyd Gaming.

After the meeting of the Coast Casinos board of directors, late in the day on January 26, 2004, Mr. Gaughan telephoned Mr. Boyd to inform him that the Coast Casinos board of directors had authorized pursuing a merger with Boyd Gaming on the terms and conditions, and for consideration of $550 per share of Coast Casinos common stock, that had been discussed and that Messrs. Gaughan, Herbst and Toti were prepared to enter into an agreement, as Coast Casinos stockholders, to vote the shares of Coast Casinos common stock owned by them in favor of the merger.

Beginning on January 27, 2004 and throughout the remainder of that week, members of the Boyd Gaming management team and members of the Coast Casinos management team discussed with each other potential

business strategies and explored the benefits of a business combination. Coast Casinos engaged Banc of America Securities as its independent financial advisor and Boyd Gaming engaged Deutsche Bank as its independent financial advisor, in each case, to assist in the evaluation and negotiation of a potential business combination between Coast Casinos and Boyd Gaming. With the assistance of its independent financial advisor and outside legal counsel, Gibson, Dunn & Crutcher LLP, Coast Casinos commenced a detailed due diligence evaluation of Boyd Gaming based on publicly available information and began assessing potential transaction structures, tax considerations and an appropriate confidentiality agreement with Boyd Gaming. At the same time, Boyd Gaming, together with its independent financial advisor and outside legal counsel, commenced a detailed due diligence evaluation of Coast Casinos based on publicly available information and began preparing drafts of a merger agreement and a stockholders agreement to be entered into among the parties to the proposed transaction.

During the same week, representatives of Gibson, Dunn & Crutcher LLP and Cravath, Swaine & Moore LLP commenced discussions concerning various business and legal requirements related to the structuring of an appropriate business combination.

On January 29, 2004, Boyd Gaming’s management held meetings and a conference call with its financial advisor and legal counsel regarding the status of their due diligence review of Coast Casinos and the structure of the proposed transaction, including the material transaction terms to be reflected in the preliminary drafts of the merger agreement and the stockholders agreement.

On January 30, 2004, Coast Casinos’ management held a conference call with its financial advisor and legal counsel regarding the status of their due diligence review of Boyd Gaming and the potential business and legal issues to be considered in the context of a business combination with Boyd Gaming.

On January 30, 2004, a proposed merger agreement containing draft terms and conditions for a merger of Coast Casinos with and into a wholly owned subsidiary of Boyd Gaming was distributed by representatives of Cravath, Swaine & Moore LLP for review by Boyd Gaming, Coast Casinos and their respective advisors. Additionally, on January 30, 2004, representatives of Cravath, Swaine & Moore LLP distributed for review a proposed stockholders agreement to be entered into among Boyd Gaming and Messrs. Gaughan, Herbst and Toti, containing draft terms and conditions related to, among other things, the voting of the shares of Coast Casinos common stock held by such stockholders in support of the merger. Based on its review of the proposed agreement and plan of merger, further detailed discussions with representatives of Gibson, Dunn & Crutcher LLP on February 1, 2004 regarding the proposed terms and conditions contained therein and input from Messrs. Gaughan, Herbst and Toti regarding the proposed terms of a stockholders agreement, Coast Casinos’ management determined that there was a sufficiently compelling business rationale for proceeding with discussions with Boyd Gaming. A business meeting to discuss terms and conditions, and to address additional financial and legal due diligence, was scheduled for February 2, 2004 at the principal offices of Boyd Gaming.

On February 2, 2004, in advance of the scheduled meeting, legal counsel for both Coast Casinos and Boyd Gaming finalized a mutually acceptable confidentiality and standstill agreement. Later that day, Coast Casinos, Boyd Gaming and each of their respective financial advisors and legal counsel met at the offices of Boyd Gaming to discuss key terms and conditions of a potential transaction and to conduct follow-up financial and legal due diligence. During that meeting, counsel for each party also engaged in a detailed discussion regarding the specific terms and conditions necessary to reach a mutually acceptable merger agreement, which included, among other matters, terms relating to the relative percentage of stock versus cash to be included in the merger consideration in order to achieve a tax-free reorganization, the conditions under which the merger agreement could be terminated by the Coast Casinos board of directors in the exercise of their fiduciary duties and the various representations, warranties, covenants and conditions to the merger.

On February 3, 2004, the Audit Committee of Boyd Gaming pre-approved Deloitte & Touche LLP to provide services in connection with the merger and the transactions contemplated by the proposed merger agreement.

Between February 2, 2004 and February 4, 2004, Coast Casinos, Boyd Gaming and their respective financial advisors and legal counsel continued to negotiate and refine the terms and conditions of a draft merger agreement and to complete all follow-up due diligence. Coast Casinos’ management, together with Messrs. Gaughan, Herbst and Toti, discussed the importance of ensuring that the Coast Casinos stockholders, other than Messrs. Gaughan and Toti, would receive merger consideration with a total value of at least $550 per share of Coast Casinos common stock at the effective time of the proposed merger. In light of the terms of the stockholders agreement, Coast Casinos’ management also discussed the importance of ensuring that no break-up fee would be payable to Boyd Gaming unless an alternative transaction was actually completed. Coast Casinos then communicated to Boyd Gaming that, among other matters, the foregoing issues had to be favorably resolved in order to complete a definitive merger agreement. During the same period of time, Boyd Gaming’s management discussed with its financial advisor and legal counsel the composition of the merger consideration and other matters, including the break-up fee to be included in the merger agreement.

During the same period of time, Messrs. Gaughan, Herbst and Toti and their legal counsel, Kummer Kaempfer Bonner & Renshaw, began negotiating with representatives from Cravath, Swaine & Moore LLP the terms and conditions of the stockholders agreement which would govern the voting of the shares of Coast Casinos common stock held by Messrs. Gaughan, Herbst and Toti.

On February 5, 2004, in advance of the special meeting of the Boyd Gaming board of directors to be held on February 6, 2004, Boyd Gaming distributed to its board of directors drafts of the merger agreement and the stockholder agreement, together with a summary of each agreement prepared by Cravath, Swaine & Moore LLP, as well as draft materials that summarized the operations of Coast Casinos and that provided certain financial analyses in respect of the merger prepared by Deutsche Bank. On the same day, in advance of the special meeting of the Coast Casinos board of directors to be held on February 6, 2004, Coast Casinos distributed to its board of directors drafts of the merger agreement and the stockholders agreement, together with a summary prepared by Gibson, Dunn & Crutcher LLP. Throughout the day and evening on February 5, 2004, Coast Casinos, Boyd Gaming and their respective financial advisors and legal counsel continued to negotiate and finalize the terms and conditions of a mutually acceptable merger agreement that satisfied the conditions outlined by both Coast Casinos’ and Boyd Gaming’s management. At the same time, Messrs. Gaughan, Herbst and Toti and their respective legal counsel, together with Boyd Gaming and its legal counsel, finalized the terms of the stockholders agreement committing Messrs. Gaughan, Herbst and Toti to vote in favor of a merger with Boyd Gaming and against any alternative transaction for a period of two years.

On the morning of February 6, 2004, the Boyd Gaming board of directors met to review and consider the proposed merger agreement and stockholders agreement, which were in substantially final form, as well as the proposed issuance of shares of Boyd Gaming common stock in the proposed merger. Mr. Boyd generally discussed the proposed merger. Afterwards, a representative of Lionel Sawyer & Collins, outside counsel to Boyd Gaming, discussed the fiduciary duties of the Boyd Gaming board of directors under Nevada law in considering the proposed merger agreement, the merger and the other transactions contemplated by the merger agreement. Representatives of Deutsche Bank summarized Deutsche Bank’s financial analyses of the proposed merger and rendered its opinion that, as of that date and based upon and subject to the assumptions made, matters considered and limits of the review undertaken by Deutsche Bank as set forth in its written opinion, the merger consideration was fair, from a financial point of view, to Boyd Gaming. A representative of Cravath, Swaine & Moore LLP reviewed in detail the material terms of the merger agreement and the stockholders agreement, including the covenant in the stockholders agreement that Messrs. Gaughan and Toti enter into an additional stockholders agreement with Boyd Gaming and Mr. Boyd pursuant to which Messrs. Gaughan and Toti would agree to restrictions on their rights to transfer the shares of Boyd Gaming common stock to be received by them in the merger. Subsequently, the representative of Cravath, Swaine & Moore LLP as well as representatives of Lionel Sawyer & Collins, Deloitte & Touche LLP, Deutsche Bank and Boyd Gaming discussed the due diligence review performed in respect of Coast Casinos. Following the presentations, the Boyd Gaming board of directors engaged in an active discussion of the proposed merger and asked questions regarding various aspects of the transaction. The merits and risks of the proposed merger were articulated by several directors during the course

of the discussion. After the discussion, the members of the Boyd Gaming board of directors determined that they had sufficient time during the course of the meeting to properly deliberate and consider the merits of the transaction and were prepared to act on the matters before them. Upon a motion duly made and seconded, the Boyd Gaming board of directors unanimously approved entering into the merger agreement and the stockholders agreement, and recommended the approval of the issuance of shares of Boyd Gaming common stock in the merger by the Boyd Gaming stockholders.

On the afternoon of February 6, 2004, after completing all technical corrections and other minor modifications to the terms and conditions of the draft stockholders agreement, Boyd Gaming and Messrs. Gaughan, Herbst and Toti executed the definitive stockholders agreement.

On the afternoon of February 6, 2004, the Coast Casinos board of directors met to review and consider the proposed merger agreement. Mr. Gaughan advised the Coast Casinos board of directors that he and Messrs. Herbst and Toti had executed a stockholders agreement pursuant to which, for two years, they were obligated to vote in favor of a merger with Boyd Gaming and against any alternative transaction. A representative of Gibson, Dunn & Crutcher LLP then summarized for the Coast Casinos board of directors the material terms of the merger agreement that had been negotiated by the parties, as well as the material terms of the stockholders agreement that had been entered into by Messrs. Gaughan, Herbst and Toti. The representative of Gibson, Dunn & Crutcher LLP also discussed with the Coast Casinos board of directors their fiduciary obligations in connection with their consideration of the proposed transaction. Following that, a representative of Banc of America Securities summarized Banc of America Securities’ financial analyses of the proposed merger and rendered its opinion to the Coast Casinos board of directors that, as of that date and based upon and subject to the various assumptions and limitations set forth in its written opinion, the merger consideration to be received by the Coast Casinos stockholders, other than Messrs. Gaughan, Herbst and Toti, in the proposed merger was fair from a financial point of view to the Coast Casinos stockholders, other than Messrs. Gaughan, Herbst and Toti. Following a careful deliberation of the merger agreement and the stockholders agreement, and after detailed discussions with its management, financial advisor, legal counsel and principal stockholders, the Coast Casinos board of directors voted unanimously to adopt the merger agreement and approve the merger and recommend that Coast Casinos stockholders vote to approve the merger agreement and the merger.

On the evening of Friday, February 6, 2004, the parties completed all technical corrections and other modifications to the terms and conditions of the draft merger agreement and executed the definitive merger agreement. On the morning of Monday, February 9, 2004, Boyd Gaming and Coast Casinos issued a joint press release announcing the execution of the merger agreement and the stockholders agreement.

Boyd Gaming’s Considerations Relating to the Merger and the Share Issuance

In reaching its decision to approve entering into the merger agreement and the stockholders agreement and recommending the approval of the issuance of shares of Boyd Gaming common stock in the merger by the Boyd Gaming stockholders, the Boyd Gaming board of directors consulted with management and Boyd Gaming’s financial and legal advisors and considered a variety of factors with respect to the merger, including the following:

Positive considerations:

•

the Boyd Gaming board of directors’ review of the business, operations, financial condition, earnings and prospects of both Boyd Gaming and Coast Casinos and consensus that the terms of the merger agreement are fair to, and in the best interest of, Boyd Gaming;

•

the Boyd Gaming board of directors’ consensus that combining Boyd Gaming with Coast Casinos would establish one of the largest casino operators in the United States;

•

the Boyd Gaming board of directors’ consensus that the Las Vegas locals sector is an appealing segment and that the additional exposure to this segment resulting from the acquisition of Coast Casinos would be positive for Boyd Gaming;

•

the Boyd Gaming board of directors’ consideration of the fact that the combined company’s experience, resources and breadth of geographical scope may allow the combined company to better compete with competitors in the hotel-casino industry;

•

the Boyd Gaming board of directors’ consideration of the structure of the transaction as a reorganization within the meaning of Section 368(a) of the Internal Revenue Code, as discussed under the “—U.S. Federal Income Tax Consequences of the Merger”;

•

the Boyd Gaming board of directors’ consensus that incremental operations in the relatively stable regulatory and tax environment of Nevada is positive for Boyd Gaming;

•

the Boyd Gaming board of directors’ consensus that Coast Casinos’ planned South Coast development and Coast Casinos’ planned expansion at The Orleans provide reasonable growth opportunities for Boyd Gaming following the acquisition of Coast Casinos;

•

the Boyd Gaming board of directors’ consensus that the stockholders agreement among Boyd Gaming and the three Coast Casinos stockholders party to the stockholders agreement provides assurance that the merger would be consummated on mutually agreed-upon terms; and

•

the Boyd Gaming board of directors’ consideration of the detailed financial and comparative analyses and presentation made by Deutsche Bank with respect to the merger and Deutsche Bank’s opinion to the Boyd Gaming board of directors that, as of such date and based upon and subject to the assumptions made, matters considered and limits of review undertaken by Deutsche Bank, the merger consideration is fair, from a financial point of view, to Boyd Gaming.

Negative considerations:

•

the Boyd Gaming board of directors’ consideration of the possibility that the merger might not be consummated;

•

the Boyd Gaming board of directors’ consideration that no significant synergies are anticipated to result from the merger;

•

the Boyd Gaming board of directors’ consideration that integration risks are inherent in combining two companies;

•

the Boyd Gaming board of directors’ consideration of the risks of developing Coast Casinos’ South Coast development, which is currently contemplated to cost approximately $350.0 million. See “Additional Risks Relating to Coast Casinos’ Operations—Coast Casinos faces significant risks in financing, developing, constructing and opening the South Coast project, which could significantly affect its business strategy and have a material adverse effect on its business, financial condition and results of operations”;

•

the Boyd Gaming board of directors’ consideration that the incremental debt associated with the merger could cause Boyd Gaming to have reduced financial flexibility in the near future; and

•

the Boyd Gaming board of directors’ consideration of other risks to which the merger and Boyd Gaming’s and Coast Casinos’ respective businesses are subject, as described above under “Risk Factors.”

The foregoing discussion of the factors considered by the Boyd Gaming board of directors in making its decision is not exhaustive, but includes all the material factors considered by the Boyd Gaming board of directors. In view of the variety of material factors considered in connection with its evaluation of the merger, the Boyd Gaming board of directors did not find it practicable to, and did not, quantify or otherwise assign relative or specific weight to any of these factors, and individual directors may have given different weight to different factors. Rather, the Boyd Gaming board of directors made its determination based on the totality of the information presented to it.

The above explanation of the Boyd Gaming board of directors’ considerations relating to the merger is forward-looking in nature. This information should be read in light of the factors discussed above under “Forward-Looking Statements May Prove Inaccurate.”

Recommendation of the Boyd Gaming Board of Directors

At its meeting on February 6, 2004, after due consideration, the Boyd Gaming board of directors unanimously adopted resolutions approving the merger agreement and the stockholders agreement, directing that the issuance of shares of Boyd Gaming common stock in the merger be submitted to a vote at the Boyd Gaming Meeting and recommending the approval of the issuance of shares of Boyd Gaming common stock in the merger by the Boyd Gaming stockholders.

Coast Casinos’ Considerations Relating to the Merger

In reaching its decision to adopt the merger agreement, approve the terms of and transactions contemplated by the merger agreement and recommend that Coast Casinos stockholders vote to approve the merger agreement and the merger, the Coast Casinos board of directors consulted with Coast Casinos’ management and financial and legal advisors and considered a variety of factors with respect to the merger, including the following:

Positive considerations:

•

the Coast Casinos board of directors’ consideration of the fact that Messrs. Gaughan, Herbst and Toti, who in the aggregate hold approximately 56% of the outstanding shares of Coast Casinos common stock, had entered into a stockholders agreement with Boyd Gaming pursuant to which they have agreed, among other things, to vote their shares of Coast Casinos common stock in favor of the approval of the merger agreement and the merger and not to support any other transaction for a period of two years;

•

the Coast Casinos board of directors’ consideration of the per share merger consideration offered by Boyd Gaming in comparison to other possible liquidity events that had been considered by Coast Casinos and to other offers and expressions of interest received by Coast Casinos prior to the execution of the merger agreement, as more fully discussed under “—Background of the Merger”;

•

the Coast Casinos board of directors’ consideration of the structure of the Boyd Gaming offer, including a provision that assures that the value of the total merger consideration to be received by Coast Casinos stockholders, other than Messrs. Gaughan and Toti, at the effective time of the merger will be at least $550 per share of Coast Casinos common stock;

•

the Coast Casinos board of directors’ consideration of the evaluation by the Coast Casinos board of directors of various strategic alternatives, including, without limitation, remaining an independent company and pursuing either solely internal growth or internal growth combined with external growth through acquisition of other companies or businesses within Coast Casinos’ industry;

•

the Coast Casinos board of directors’ consideration of the terms of the merger agreement, including, without limitation, that the merger agreement:

—

permits Coast Casinos to furnish information and participate in discussions or negotiations with a person that submits an unsolicited takeover proposal upon the conditions discussed below under “The Merger Agreement—No Solicitation”;

—

permits the Coast Casinos board of directors to withdraw or modify its approval or recommendation of the merger and the merger agreement upon the conditions discussed below under “The Merger Agreement—No Solicitation”; and

—

provides that the $30.0 million termination fee is payable by Coast Casinos to Boyd Gaming only upon the consummation by Coast Casinos of another takeover transaction and upon occurrence of the other events discussed below under “The Merger Agreement—Fee if the Merger Agreement is Terminated”;

•

the Coast Casinos board of directors’ consideration of the written opinion of Banc of America Securities provided to the Coast Casinos board of directors on February 6, 2004 that, as of such date and based upon and subject to the various assumptions and limitations set forth in the written opinion, the merger

consideration to be received by the Coast Casinos stockholders, other than Messrs. Gaughan, Herbst and Toti, in the proposed merger was fair from a financial point of view to the Coast Casinos stockholders, other than Messrs. Gaughan, Herbst and Toti;

•

the Coast Casinos board of directors’ consideration of the ability of the Coast Casinos stockholders, other than Messrs. Gaughan, Herbst and Toti, to vote against the approval of the merger agreement and the merger at the Coast Casinos Meeting in the event that a superior proposal is received in accordance with the terms of the merger agreement, as described under “—Background of the Merger—Discussions”;

•

the Coast Casinos board of directors’ consideration of the greater liquidity of Boyd Gaming common stock following the merger as compared to Coast Casinos common stock, which is not listed or traded on any national securities exchange or quotation system;

•

the Coast Casinos board of directors’ consideration of the structure of the transaction as a reorganization within the meaning of Section 368(a) of the Internal Revenue Code, as discussed under “—U.S. Federal Income Tax Consequences of the Merger”;

•

the Coast Casinos board of directors’ consideration of the fact that, to the extent that they may elect and subject to the applicable proration provisions of the merger agreement, the Coast Casinos stockholders, other than Mr. Herbst, will receive a portion of their merger consideration in the form of shares of Boyd Gaming common stock, thereby providing them with an opportunity to participate in the growth and opportunities of the combined company;

•

the Coast Casinos board of directors’ consideration of the greater financial resources of the combined company, which is expected to provide management with greater flexibility with respect to financing and operating opportunities;

•

the Coast Casinos board of directors’ consideration of the fact that the combined company’s broader range and geographic scope of hotel-casino locations will provide the combined company with a more diverse market presence and may allow the combined company to better compete with competitors in the hotel-casino industry;

•

Coast Casinos management’s view of the financial condition, results of operations and businesses of Coast Casinos and Boyd Gaming, before and after giving effect to the merger;

•

the Coast Casinos board of directors’ consideration of the potential investment risks to Coast Casinos stockholders with respect to Coast Casinos remaining an independent company, as compared to the merger consideration that would be paid to Coast Casinos stockholders under the terms of the merger agreement;

•

the Coast Casinos board of directors’ belief that the terms of the merger agreement, including the parties’ representations, warranties, covenants and conditions to their respective obligations, are reasonable for a transaction of this nature;

•

the Coast Casinos board of directors’ consideration of the financial analyses presented by representatives of Banc of America Securities and a comparison of the historical value of Coast Casinos common stock and the consideration to be received by Coast Casinos stockholders in the merger;

•

the Coast Casinos board of directors’ consideration of the fact that Mr. Gaughan and two of his designees satisfactory to Boyd Gaming will serve on the Boyd Gaming board of directors, which should facilitate the integration of Coast Casinos into Boyd Gaming; and

•

the Coast Casinos board of directors’ consideration of the fact that senior Coast Casinos management is expected to have significant responsibilities with respect to the new Coast Casinos, Inc., which should facilitate the integration of Coast Casinos into the combined company.

Negative considerations:

•

the Coast Casinos board of directors’ consideration of the possibility that the merger might not be consummated;

•

the Coast Casinos board of directors’ consideration of the fact that the merger consideration to the Coast Casinos stockholders, other than Messrs. Gaughan and Toti, will be substantially in cash, which will avoid future market risk from holding Boyd Gaming common stock but may prevent such Coast Casinos stockholders from substantially enjoying any significant upside potential relating to the combined company;

•

the Coast Casinos board of directors’ consideration of the risk that the potential benefits sought in the merger might not be fully realized;

•

the Coast Casinos board of directors’ consideration of the risk that, notwithstanding the long-term benefits of the merger, the combined company’s financial condition, results of operations and stock price might decline after the consummation of the merger; and

•

the Coast Casinos board of directors’ consideration of other risks to which the merger and Boyd Gaming’s and Coast Casinos’ respective businesses are subject, as described above under “Risk Factors.”

The foregoing discussion of the factors considered by the Coast Casinos board of directors in making its decision is not exhaustive, but includes all the material factors considered by the Coast Casinos board of directors. In view of the variety of material factors considered in connection with its evaluation of the merger, the Coast Casinos board of directors did not find it practicable to, and did not, quantify or otherwise assign relative or specific weight to any of these factors, and individual directors may have given different weight to different factors. Rather, the Coast Casinos board of directors made its determination based on the totality of the information presented to it.

The above explanation of the Coast Casinos board of directors’ considerations relating to the merger is forward-looking in nature. This information should be read in light of the factors discussed above under “Forward-Looking Statements May Prove Inaccurate.”

In adopting the merger agreement and approving the merger, the Coast Casinos board of directors was aware of the interests of certain directors and officers of Coast Casinos in the merger, as discussed below under “—Interests of Coast Casinos’ Directors and Executive Officers in the Merger.”

Recommendation of the Coast Casinos Board of Directors

At its meeting on February 6, 2004, after due consideration, the Coast Casinos board of directors unanimously adopted resolutions adopting the merger agreement and approving the merger, determining that the terms of the merger agreement and the merger are fair to and in the best interests of Coast Casinos and its stockholders, directing that the merger agreement be submitted to a vote of the Coast Casinos stockholders at the Coast Casinos Meeting and recommending that the Coast Casinos stockholders approve the merger agreement and the merger.

Opinion of Boyd Gaming’s Financial Advisor

Deutsche Bank has acted as financial advisor to Boyd Gaming in connection with the merger. On February 6, 2004, Deutsche Bank delivered its oral opinion to the Boyd Gaming board of directors, subsequently confirmed in writing as of the same date, to the effect that, as of such date, based upon and subject to the assumptions made, matters considered and limits of the review undertaken by Deutsche Bank, the merger consideration was fair, from a financial point of view, to Boyd Gaming. For purposes of its opinion, the merger consideration consisted of:

•

the stock consideration paid to Michael J. Gaughan and Franklin Toti;

•

the cash consideration paid to Jerry Herbst;

•

the stock consideration paid to minority stockholders who elect such consideration, including any adjustment made thereto in accordance with the terms of the merger agreement; and

•

the cash consideration paid to minority stockholders who do not elect stock consideration, including any adjustment made thereto in accordance with the terms of the merger agreement.

The full text of Deutsche Bank’s written opinion, dated February 6, 2004, which discusses, among other things, the assumptions made, matters considered and limits on the review undertaken by Deutsche Bank in connection with the opinion, is attached as Annex B to this joint proxy statement/prospectus and is incorporated herein by reference. Boyd Gaming stockholders are urged to read this opinion in its entirety. The following summary of the Deutsche Bank opinion is qualified in its entirety by reference to the full text of the opinion.

In connection with Deutsche Bank’s role as financial advisor to Boyd Gaming, and in arriving at its opinion, Deutsche Bank has reviewed certain publicly available financial and other information concerning Coast Casinos and Boyd Gaming and certain internal analyses and other information furnished to it by Coast Casinos and Boyd Gaming. Deutsche Bank has also held discussions with members of the senior managements of Coast Casinos and Boyd Gaming regarding the businesses and prospects of their respective companies and the joint prospects of a combined company. In addition, Deutsche Bank has:

•

reviewed the reported prices and trading activity for Boyd Gaming common stock;

•

compared certain financial information for Coast Casinos and Boyd Gaming with similar information for certain companies whose securities are publicly traded;

•

reviewed the financial terms of certain recent business combinations which it deemed comparable to the merger in whole or in part;

•

reviewed the terms of the merger agreement, the stockholders agreement and certain related documents; and

•

performed such other studies and analyses and considered such other factors as it deemed appropriate.

In preparing its opinion, Deutsche Bank did not assume responsibility for the independent verification of, and did not independently verify, any information, whether publicly available or furnished to it, concerning Coast Casinos or Boyd Gaming, including, without limitation, any financial information, forecasts or projections considered in connection with the rendering of its opinion. Accordingly, for purposes of its opinion, Deutsche Bank assumed and relied upon the accuracy and completeness of all such information. Deutsche Bank did not conduct a physical inspection of any of the properties or assets, and did not prepare or obtain any independent evaluation or appraisal of any of the assets or liabilities, of Coast Casinos or Boyd Gaming. With respect to the financial forecasts and projections made available to Deutsche Bank and used in its analysis, Deutsche Bank has assumed that they have been reasonably prepared on bases reflecting the best currently available estimates and judgments of the management of Coast Casinos or Boyd Gaming as to the matters covered thereby. In rendering its opinion, Deutsche Bank expressed no view as to the reasonableness of those forecasts and projections or the assumptions on which they are based. Deutsche Bank’s opinion was necessarily based upon economic, market and other conditions as in effect on, and the information made available to Deutsche Bank as of, the date of its opinion.

For purposes of rendering its opinion, Deutsche Bank has assumed that, in all respects material to its analysis:

•

the representations and warranties of Boyd Gaming, BGC, Inc. and Coast Casinos contained in the merger agreement are true and correct;

•

Boyd Gaming, BGC, Inc. and Coast Casinos will each perform all of the covenants and agreements to be performed by it under the merger agreement;

•

all conditions to the obligations of each of Boyd Gaming, BGC, Inc. and Coast Casinos to consummate the merger will be satisfied without any waiver thereof; and

•

all material governmental, regulatory or other approvals and consents required in connection with the consummation of the merger will be obtained and that, in connection with obtaining any necessary governmental, regulatory or other approvals and consents, or any amendments, modifications or waivers to any agreements, instruments or orders to which either Boyd Gaming or Coast Casinos is a party or is subject or by which it is bound, no limitations, restrictions or conditions will be imposed or amendments, modifications or waivers will be made that would have a material adverse effect on Boyd Gaming or Coast Casinos or materially reduce the contemplated benefits of the merger to Boyd Gaming.

In addition, Deutsche Bank has been advised by Boyd Gaming, and accordingly has assumed for purposes of its opinion, that the merger will be tax-free to Boyd Gaming.

Deutsche Bank’s Financial Analysis

Set forth below is a summary of the material financial analyses performed by Deutsche Bank in connection with its opinion and reviewed with the Boyd Gaming board of directors at its meeting on February 6, 2004.

Analysis of Selected Publicly Traded Companies. Deutsche Bank reviewed certain financial information and calculated commonly used valuation measurements for Boyd Gaming and Coast Casinos, as applicable, to corresponding information and measurements for groups of publicly traded companies in the gaming industry.

The publicly traded companies selected in the gaming industry to which Boyd Gaming was compared consisted of:

•

Ameristar Casinos Inc.

•

Argosy Gaming Co.

•

Aztar Corp.

•

Isle of Capri Casinos, Inc.

•

Penn National Gaming Inc.

•

Station Casinos Inc.

The publicly traded companies selected in the gaming industry to which Coast Casinos was compared consisted of:

•

Ameristar Casinos Inc.

•

Argosy Gaming Co.

•

Aztar Corp.

•

Boyd Gaming Corp.

•

Isle of Capri Casinos, Inc.

•

Penn National Gaming Inc.

•

Station Casinos Inc.

The financial information and valuation measurements reviewed by Deutsche Bank included, among other things:

•

current share price;

•

total equity market valuation;

•

total enterprise value (the sum of equity market valuation and net debt); and

•

ratios of total enterprise value to earnings before interest, taxes, depreciation and amortization, or EBITDA.

To calculate the trading multiples, Deutsche Bank used publicly available information concerning historical and projected financial performance, including analyst reports and published historical financial information and earnings estimates reported by Institutional Brokers Estimate System, or IBES. IBES is a data service that monitors and publishes compilations of earnings estimates by selected research analysts regarding companies of interest to institutional investors.

Deutsche Bank observed that the implied value of Coast Casinos common stock based on the selected publicly traded companies analysis ranged from $450 to $625 per share and compared that range of values to the notional merger consideration of $550 per share. Deutsche Bank also observed that the implied value of Boyd Gaming’s common stock based on the selected publicly traded companies analysis ranged from $14.00 to $18.75 per share and compared that range of values to the average trading price of Boyd Gaming common stock for the ten day period ended February 5, 2004, which was $16.77, and which forms the basis for the exchange ratio for the stock consideration in the merger.

None of the companies utilized in the publicly traded company analysis is identical to Boyd Gaming or Coast Casinos. Accordingly, Deutsche Bank believes the analysis is not simply mathematical. Rather, it involves complex considerations and qualitative judgments, reflected in Deutsche Bank’s opinion, concerning differences in financial and operating characteristics of the selected companies and other factors that could affect the public trading value of the selected companies.

Analysis of Selected Precedent Transactions. Deutsche Bank reviewed ten mergers and acquisition transactions announced since March 6, 2000 in the gaming industry. The transactions reviewed, which are referred to as the “selected transactions,” were:


Date announced	Target	Acquirer
12/24/03	Las Vegas Hilton	Colony Capital
09/12/03	Horseshoe Gaming	Harrah’s Entertainment
06/26/03	Golden Nugget casinos	Poster Financial Group
06/20/03	Aladdin Hotel & Casino	Investor Group(1)
08/07/02	Hollywood Casino Corp.	Penn National Gaming
10/18/00	The Reserve Hotel & Casino	Station Casinos
07/20/00	Fiesta Casino Hotel	Station Casinos
06/13/00	Santa Fe Hotel and Casino	Station Casinos
04/27/00	Desert Inn	Steve Wynn
03/06/00	Mirage Resorts	MGM Grand, Inc.

(1)	Investor group comprised of Starwood Hotels & Resorts, Robert Earl and Bay Harbour Management.

Deutsche Bank observed that the relevant ratio of total enterprise value to forward EBITDA for the selected transactions ranged from 7.5x to 9.0x and compared that range of multiples to the 7.3x ratio underlying the merger consideration.

The analysis for the selected transactions was based on public information available at the time of announcement of such transactions, without taking into account differing market and other conditions during the period between March 6, 2000 and December 24, 2003, during which the selected transactions were announced.

Discounted Cash Flow Analysis. Deutsche Bank performed a discounted cash flows analysis for both Coast Casinos and Boyd Gaming. Deutsche Bank calculated the discounted cash flow values for each of Coast Casinos and Boyd Gaming as the sum of the net present values of:

•

the estimated future free cash flows that Coast Casinos or Boyd Gaming, as the case may be, would generate for the years 2004 through 2008; and

•

the terminal value of Coast Casinos or Boyd Gaming at the end of such period.

The estimated future free cash flows were based on the financial projections for Coast Casinos for the years 2004 through 2008 prepared by Coast Casinos’ management, and on the financial projections for Boyd Gaming for the years 2004 through 2008 prepared by Boyd Gaming’s management. The terminal value for Coast Casinos was calculated based on projected EBITDA for 2008 and a range of multiples of EBITDA ranging from 6.5x to 8.0x. The terminal value for Boyd Gaming was calculated based on projected EBITDA for 2008 and a range of multiples of EBITDA ranging from 6.5x to 7.5x. Deutsche Bank used discount rates ranging from 8.0% to 10.0% for Coast Casinos and ranging from 7.0% to 9.0% for Boyd Gaming. The discount rates for Coast Casinos were based on Deutsche Bank’s judgment of the estimated weighted average cost of Coast Casinos’ capital and the EBITDA multiples were based on its review of the characteristics that in its judgment would have applied to Coast Casinos if it were a publicly traded company. The discount rates for Boyd Gaming were based on Deutsche Bank’s judgment of the estimated weighted average cost of Boyd Gaming’s capital and the EBITDA multiples were based on its review of the trading characteristics of Boyd Gaming.

Deutsche Bank observed that the implied value of Coast Casinos common stock based on the discounted cash flow analysis ranged from $575 to $725 per share and compared that range of values to the notional merger consideration of $550 per share. Deutsche Bank also observed that the implied value of Boyd Gaming common stock based on the discounted cash flow analysis ranged from $18.50 to $22.25 per share and compared that range of values to the average trading price of Boyd Gaming common stock for the ten day period ended February 5, 2004, which was $16.77, and which forms the basis for the exchange ratio for stock consideration in the merger.

Pro Forma Combined Earnings Analysis. Deutsche Bank analyzed certain pro forma effects of the merger. Based on this analysis, Deutsche Bank computed the resulting accretion to Boyd Gaming’s earnings per share, or EPS, estimate for the fiscal years ending 2004 and 2005. Deutsche Bank noted that the merger would be 4.4% and 9.8% accretive to Boyd Gaming’s EPS estimate for the fiscal years ending 2004 and 2005, respectively. To calculate the pro forma earnings estimates, Deutsche Bank used forward estimates of projected financial performance for Boyd Gaming that were provided by Boyd Gaming management and forward estimates of projected financial performance for Coast Casinos that were prepared by the Coast Casinos’ management.

General. The foregoing summary describes all analyses and factors that Deutsche Bank deemed material in its presentation to the Boyd Gaming board of directors, but is not a comprehensive description of all analyses performed and factors considered by Deutsche Bank in connection with preparing its opinion. The preparation of a fairness opinion is a complex process involving the application of subjective business judgment in determining the most appropriate and relevant methods of financial analysis and the application of those methods to the particular circumstances and, therefore, is not readily susceptible to summary description. Deutsche Bank believes that its analyses must be considered as a whole and that considering any portion of such analyses and of the factors considered without considering all analyses and factors could create a misleading view of the process underlying the opinion. In arriving at its fairness determination, Deutsche Bank did not assign specific weights to any particular analyses.

In conducting its analyses and arriving at its opinions, Deutsche Bank utilized a variety of generally accepted valuation methods. The analyses were prepared solely for the purpose of enabling Deutsche Bank to provide its opinion to the Boyd Gaming board of directors as to the fairness to Boyd Gaming of the merger consideration and do not purport to be appraisals or necessarily reflect the prices at which businesses or securities actually may be sold, which are inherently subject to uncertainty. In connection with its analyses, Deutsche Bank made, and was provided by Boyd Gaming’s management and Coast Casinos’ management with, numerous assumptions with respect to industry performance, general business and economic conditions and other matters, many of which are beyond Boyd Gaming’s or Coast Casinos’ control. Analyses based on estimates or forecasts of future results are not necessarily indicative of actual past or future values or results, which may be significantly more or less favorable than suggested by such analyses. Because such analyses are inherently subject to uncertainty, being based upon numerous factors or events beyond the control of Boyd Gaming, Coast Casinos or their respective advisors, neither Boyd Gaming nor Deutsche Bank nor any other person assumes responsibility if future results or actual values are materially different from these forecasts or assumptions.

The terms of the merger were determined through negotiations between Boyd Gaming and Coast Casinos and were approved by the Boyd Gaming board of directors. Although Deutsche Bank provided advice to Boyd Gaming during the course of these negotiations, the decision to enter into the merger was solely that of the Boyd Gaming board of directors. As described above, the opinion and presentation of Deutsche Bank to the Boyd Gaming board of directors were only one of a number of factors taken into consideration by the Boyd Gaming board of directors in making its determination to approve the merger. Deutsche Bank’s opinion was provided to the Boyd Gaming board of directors to assist it in connection with its consideration of the merger and does not constitute a recommendation to any stockholder as to how to vote or take any other action with respect to the merger. Deutsche Bank’s opinion does not in any manner address the prices at which shares of Boyd Gaming common stock will trade after the announcement or consummation of the merger.

Boyd Gaming selected Deutsche Bank as financial advisor in connection with the merger based on Deutsche Bank’s qualifications, expertise, reputation and experience in mergers and acquisitions. Boyd Gaming has retained Deutsche Bank pursuant to a letter agreement dated February 2, 2004, which is referred to as the “engagement letter.” Deutsche Bank will be paid a reasonable and customary fee for its services as financial advisor to Boyd Gaming in connection with the merger, a substantial portion of which is contingent upon consummation of the merger. Deutsche Bank is an affiliate of Deutsche Bank AG, which, together with its affiliates, is referred to as the “DB Group.” One or more members of the DB Group have agreed to provide financing to Boyd Gaming in connection with the merger, some of which funds are expected to be used to pay off existing loans made by members of the DB Group to Coast Casinos and to Boyd Gaming. Regardless of whether the merger is consummated, Boyd Gaming has agreed to reimburse Deutsche Bank for reasonable fees and disbursements of Deutsche Bank’s outside counsel and all of Deutsche Bank’s reasonable documented travel and other out-of-pocket expenses incurred in connection with the merger or otherwise arising out of the retention of Deutsche Bank under the engagement letter. Boyd Gaming has also agreed to indemnify Deutsche Bank and certain related persons to the full extent lawful against certain liabilities, including certain liabilities under the U.S. Federal securities laws arising out of its engagement or the merger.

Deutsche Bank is an internationally recognized investment banking firm experienced in providing advice in connection with mergers and acquisitions and related transactions. A member of the DB Group acted as co-manager under Coast Casinos’ February 2002 $125.0 million 9.50% senior subordinated notes issuance. A member of the DB Group acted as syndication agent under Coast Casinos’ September 2003 $300.0 million senior secured credit facility. In the foregoing capacities, Deutsche Bank has received an aggregate of $340,657.90 in compensation from Coast Casinos. A member of the DB Group acted as joint book-running manager under Boyd Gaming’s March 2002 $250.0 million 8.75% senior subordinated notes offering. A member of the DB Group acted as co-documentation agent under Boyd Gaming’s June 2002 $500.0 million senior secured credit facility. A member of the DB Group acted as joint book-running manager of Boyd Gaming’s December 2002 $300.0 million 7.75% senior subordinated notes offering. In the foregoing capacities, Deutsche Bank has received an aggregate of $2,827,170.50 in compensation from Boyd Gaming.

In the ordinary course of business, members of the DB Group may actively trade in the securities and other instruments and obligations of Boyd Gaming and Coast Casinos for their own accounts and for the accounts of their customers. Accordingly, the DB Group may at any time hold a long or short position in such securities, instruments and obligations.

Opinion of Coast Casinos’ Financial Advisor

In connection with Banc of America Securities’ engagement as financial advisor to Coast Casinos, Coast Casinos requested that Banc of America Securities render an opinion to the Coast Casinos board of directors as to the fairness, from a financial point of view, to the Coast Casinos stockholders, other than Messrs. Gaughan, Herbst and Toti, of the merger consideration to be received by the stockholders, other than Messrs. Gaughan, Herbst and Toti, in the proposed merger. On February 6, 2004, Banc of America Securities delivered its oral opinion, which opinion was subsequently confirmed by delivery of its written opinion dated February 6, 2004, to

the Coast Casinos board of directors that, as of that date and based upon and subject to the various assumptions and limitations summarized below, the merger consideration to be received by the Coast Casinos stockholders, other than Messrs. Gaughan, Herbst and Toti, in the proposed merger was fair from a financial point of view to the Coast Casinos stockholders, other than Messrs. Gaughan, Herbst and Toti.

The full text of Banc of America Securities’ written opinion, dated February 6, 2004, is attached as Annex C to this joint proxy statement/prospectus. This opinion sets forth the assumptions made, procedures followed, other matters considered and limitations of the review undertaken. We incorporate the Banc of America Securities opinion in its entirety into this document and this section by reference and urge you to read the opinion carefully and in its entirety. This section is only a summary of the Banc of America Securities opinion and as a summary is qualified by reference to, and not a substitute for, the full text of the opinion.

Banc of America Securities’ analyses and opinion were prepared for and addressed to the Coast Casinos board of directors and are directed only to the fairness from a financial point of view to the Coast Casinos stockholders, other than Messrs. Gaughan, Herbst and Toti, of the merger consideration to be received by the Coast Casinos stockholders, other than Messrs. Gaughan, Herbst and Toti, in the proposed merger and do not constitute an opinion as to the merits of the merger or an opinion or recommendation as to how the stockholders of Coast Casinos and Boyd Gaming should vote on the proposed merger.

In furnishing its opinion, Banc of America Securities did not admit that it is an “expert” as that term is used in the Securities Act of 1933, as amended, nor did Banc of America Securities admit that its opinion constitutes a report or valuation within the meaning of Section 11 of the Securities Act. Statements to that effect are included in the Banc of America Securities opinion.

In arriving at its opinion, Banc of America Securities:

•

reviewed certain publicly available financial statements and other business and financial information of Coast Casinos and Boyd Gaming, respectively;

•

reviewed certain internal financial statements and other financial and operating data concerning Coast Casinos and Boyd Gaming, respectively;

•

analyzed certain financial forecasts prepared by the managements of Coast Casinos and Boyd Gaming, respectively;

•

reviewed and discussed with senior executives of Coast Casinos and Boyd Gaming their views of certain strategic, financial and operational benefits anticipated from the merger;

•

discussed the past and current operations, financial condition and prospects of Coast Casinos with senior executives of Coast Casinos and discussed the past and current operations, financial condition and prospects of Boyd Gaming with senior executives of Boyd Gaming;

•

reviewed the pro forma impact of the merger on Boyd Gaming’s earnings per share, cash flow, consolidated capitalization and financial ratios;

•

reviewed the reported prices and trading activity for Boyd Gaming common stock;

•

compared the financial performance of Coast Casinos and Boyd Gaming and the prices and trading activity of Boyd Gaming common stock with that of certain other publicly traded companies Banc of America Securities deemed relevant;

•

compared certain financial terms of the merger to financial terms, to the extent publicly available, of certain other business combination transactions Banc of America Securities deemed relevant;

•

participated in discussions among representatives of Coast Casinos and Boyd Gaming and their financial and legal advisors;

•

reviewed the February 6, 2004 draft of the merger agreement and certain related documents; and

•

performed such other analyses and considered such other factors as Banc of America Securities deemed appropriate.

In conducting its review and arriving at its opinion, Banc of America Securities assumed and relied upon, without independent verification, the accuracy and completeness of the financial and other information reviewed by it for the purposes of the opinion. With respect to the financial forecasts, including information relating to certain strategic, financial and operational benefits anticipated from the merger, Banc of America Securities assumed that they were reasonably prepared on bases reflecting the best currently available estimates and good faith judgments of the future financial performance of Coast Casinos and Boyd Gaming. Banc of America Securities did not make any independent valuation or appraisal of the assets or liabilities of Coast Casinos or Boyd Gaming, nor was Banc of America Securities furnished with any such appraisals.

Banc of America Securities assumed that the final executed merger agreement would not differ in any material respect from the draft agreement reviewed by it, and that the merger would be consummated as provided in the draft agreement, with full satisfaction of all covenants and conditions set forth in the draft agreement and without any waivers thereof. Banc of America Securities also assumed that in connection with the receipt of the regulatory approvals required to consummate the merger, no conditions would be imposed upon Coast Casinos or Boyd Gaming that would have a material adverse effect on Boyd Gaming, Coast Casinos or the benefits expected to be derived by the merger.

As is customary in the rendering of fairness opinions, Banc of America Securities based its opinion on financial, economic, market and other conditions as in effect on, and the information made available to Banc of America Securities as of, February 6, 2004. It was understood that, although subsequent developments may affect Banc of America Securities’ opinion, Banc of America Securities does not have any obligation to update, revise or reaffirm its opinion. Banc of America Securities’ opinion did not address the prices at which the common stock of Boyd Gaming will trade following the execution of the merger agreement or consummation of the merger. Banc of America Securities was not authorized to and did not solicit any expressions of interest from any other parties with respect to the sale of all or any part of Coast Casinos or any other alternative transaction. Consequently, no opinion was expressed as to whether any alternative transaction might produce consideration for the Coast Casinos stockholders in an amount in excess of that contemplated in the merger. The opinion of Banc of America Securities expressed in its opinion letter was provided for the benefit and use of the Coast Casinos board of directors. Banc of America Securities expressed no opinion or recommendation as to how the stockholders of Coast Casinos and Boyd Gaming should vote at the stockholders’ meetings held in connection with the merger.

In accordance with customary investment banking practice, Banc of America Securities employed generally accepted valuation methods in reaching its opinion. The following is a summary of the material financial analyses that Banc of America Securities utilized in providing its opinion. Some of the summaries of financial analyses are presented in tabular format. In order to understand the financial analyses used by Banc of America Securities more fully, you should read the tables together with the related text. The tables alone do not constitute a complete description of the financial analyses utilized by Banc of America Securities.

Analysis of Selected Publicly Traded Companies

Using publicly available and other information, Banc of America Securities compared selected historical and projected operating and financial data of Coast Casinos and Boyd Gaming with similar data for selected publicly traded companies engaged in businesses that Banc of America Securities judged to be generally comparable to those of Coast Casinos and Boyd Gaming. These companies were:

•

Station Casinos, Inc.

•

Pinnacle Entertainment, Inc.

•

Boyd Gaming Corporation

•

Penn National Gaming, Inc.

•

Aztar Corporation

•

Argosy Gaming Company

•

Ameristar Casinos, Inc.

•

Isle of Capri Casinos, Inc.

For each of these companies, Banc of America Securities calculated the multiple of enterprise value, which Banc of America Securities defined as diluted equity market value (calculated using the treasury method) plus total debt, less cash and cash equivalents, to estimated 2003 EBITDA and projected 2004 EBITDA. Banc of America Securities also calculated the multiple of price per share to estimated 2003 earnings per share and projected 2004 earnings per share. The calculations yielded the ranges as set forth below.


	Enterprise Value/2003E EBITDA	Enterprise Value/2004P EBITDA	2003 P/E	2004 P/E
High	11.3	9.7	28.0	20.1
Median	7.8	6.7	14.3	12.7
Low	6.1	5.7	12.1	11.1

Banc of America Securities then selected a range of 6.0x to 7.0x for 2004P EBITDA and a range of 11.0x to 15.0x for 2004P earnings per share, and applied these multiples to the respective operating statistics of Coast Casinos and Boyd Gaming. This analysis yielded an implied value for Coast Casinos common stock of approximately $400 to $530 per share, and an implied trading value for Boyd Gaming common stock of approximately $13.50 to $18.25 per share.

Although the selected companies were used for comparative purposes, none of such companies is directly comparable to Coast Casinos or Boyd Gaming. Accordingly, an analysis of the results of such a comparison is not purely mathematical but instead involves complex considerations and judgments concerning differences in historical and projected financial and operating characteristics of the selected companies and other factors that could affect the public trading value of the companies or Coast Casinos or Boyd Gaming or of the companies to which they are being compared.

Analysis of Selected Transactions

Banc of America Securities analyzed publicly available financial information relating to selected merger transactions in the gaming industry, which Banc of America Securities deemed relevant in evaluating the merger. Banc of America Securities analyzed the following transactions:


Acquiror		Target
Colony Capital Inc.		Harvey’s Casino Resorts
CSM NV		Bally Entertainment Corp.
Harrah’s Entertainment, Inc.		Horseshoe Gaming, L.L.C.
Harrah’s Entertainment, Inc.		Harvey’s Casino Resorts
Harrah’s Entertainment, Inc.		Players International Inc.
Hollywood Park Inc.		Boomtown, Inc.
Hollywood Park Inc.		Casino Magic Corp
Horseshoe Gaming, L.L.C.		Empress Entertainment, Inc.
Isle of Capri Casinos, Inc.		Lady Luck Gaming Corp
ITT Corp.		Caesar’s World Inc.
MGM Grand Inc.		Mirage Resorts Inc.
MGM Grand Inc.		Primadonna Resorts Inc.,
Park Place Entertainment Corp.		Caesar’s World Inc.
Penn National Gaming, Inc		Hollywood Casino Corp.

Banc of America Securities reviewed the consideration paid in the selected transactions based, in the case of transactions in which the consideration was stock, on stock prices on the day prior to the announcement of the transaction, and then calculated multiples of total enterprise value represented by that consideration to the LTM EBITDA of the target company. Banc of America Securities applied a range of multiples of 6.5x to 7.5x to the 2003E EBITDA of Coast Casinos and Boyd Gaming. This analysis yielded an implied value for Coast Casinos common stock of approximately $405 to $510 per share, and an implied trading value for Boyd Gaming common stock of approximately $9.50 to $13.25.

Although the selected transactions were used for comparative purposes, none of these transactions is directly comparable to the merger, and none of the companies in such transactions is directly comparable to Coast Casinos or Boyd Gaming. Accordingly, an analysis of the results of such a comparison is not purely mathematical but instead involves complex considerations and judgments concerning differences in historical and projected financial and operating characteristics of the companies involved and other factors that could affect the acquisition value of Coast Casinos, Boyd Gaming or of the selected companies to which they are being compared.

Discounted Cash Flow Analysis

Banc of America Securities performed discounted cash flow analyses to determine the fully diluted equity value per share for each of Coast Casinos and Boyd Gaming by valuing each company based on the present value of that company’s projected free cash flows, assuming no debt obligations. In conducting this analysis, Banc of America Securities used cash flow projections of Coast Casinos and Boyd Gaming for fiscal years 2003 to 2008 prepared by their respective managements and Banc of America Securities assumed that the companies would perform in accordance with these projections.

Banc of America Securities first estimated the terminal values of the projected cash flows by applying a multiple of 2008 EBITDA, ranging from 6.5x to 7.5x. Banc of America Securities then calculated the present value of the projected cash flows for five years using discount rates ranging from 8% to 10% for Coast Casinos and 7% to 8% for Boyd Gaming. Based on the results of this analysis, Banc of America Securities derived a range of equity values of between $445 and $630 per share for Coast Casinos common stock, and a range of equity values of between $15.75 and $21.50 per share for Boyd Gaming common stock.

General

The summary set forth above does not purport to be a complete description of all the analyses performed by Banc of America Securities. The preparation of a fairness opinion involves various determinations as to the most appropriate and relevant methods of financial analyses and the application of these methods to the particular circumstances and, therefore, such an opinion is not readily susceptible to partial analysis or summary description.

Banc of America Securities did not attribute any particular weight to any analysis or factor considered by it, but rather made qualitative judgments as to the significance and relevance of each analysis and factor. Accordingly, notwithstanding the separate factors summarized above, Banc of America Securities believes, and has advised the Coast Casinos board of directors, that its analyses must be considered as a whole and that selecting portions of its analyses and the factors considered by it, without considering all analyses and factors, could create an incomplete view of the process underlying its opinion.

In performing its analyses, Banc of America Securities made numerous assumptions with respect to industry performance, business and economic conditions and other matters, many of which are beyond the control of Coast Casinos and Boyd Gaming. These analyses performed by Banc of America Securities are not necessarily indicative of actual values or future results, which may be significantly more or less favorable than suggested by such analyses. In addition, analyses relating to the value of businesses do not purport to be appraisals or to reflect the prices at which businesses or securities may actually be sold. Accordingly, such analyses and estimates are

inherently subject to uncertainty, being based upon numerous factors or events beyond the control of the parties or their respective advisors, and none of Coast Casinos and Boyd Gaming, Banc of America Securities or any other person assumes responsibility if future results are materially different from those projected.

As mentioned above, the analyses supplied by Banc of America Securities and its opinion were among the factors taken into consideration by the Coast Casinos board of directors in making its decision to enter into the merger agreement and should not be considered as determinative of such decision.

Banc of America Securities was selected by the Coast Casinos board of directors to act as its financial advisor in connection with the merger, and to render an opinion to Coast Casinos board of directors, because Banc of America Securities is an internationally recognized investment banking firm and because, as part of its investment banking business, Banc of America Securities is continually engaged in the valuation of businesses and their securities in connection with mergers and acquisitions, negotiated underwritings, secondary distributions of listed and unlisted securities, private placements and valuations for corporate and other purposes.

Banc of America Securities or its affiliates have provided and may in the future provide financial advisory and financing services to Coast Casinos and Boyd Gaming and have received or may in the future receive fees for the rendering of these services. Bank of America, N.A., an affiliate of Banc of America Securities, serves as agent bank and is a lender under Coast Casinos’ senior credit facility and is a lender under Boyd Gaming’s senior credit facility and has received fees for the rendering of such services. In the ordinary course of its businesses, Banc of America Securities and its affiliates may actively trade the debt and equity securities or loans of Coast Casinos and Boyd Gaming for its own account or for the accounts of customers, and, accordingly, it may at any time hold long or short positions in such securities or loans.

Coast Casinos has agreed to pay Banc of America Securities a fee of $5,625,000 for its services, a portion of which was contingent upon the rendering of an opinion and a significant portion of which is contingent upon the consummation of the merger. Coast Casinos has also agreed to reimburse Banc of America Securities for all reasonable out-of-pocket expenses (including reasonable fees and disbursements of Banc of America Securities’ outside counsel), subject to a cap, and to indemnify Banc of America Securities against certain liabilities, including liabilities under the federal securities laws. The terms of the fee arrangement with Banc of America Securities, which are customary in transactions of this nature, were negotiated at arm’s length between Coast Casinos and Banc of America Securities, and the Coast Casinos board of directors was aware of such arrangement, including the fact that a significant portion of the aggregate fee payable to Banc of America Securities is contingent upon consummation of the merger.

Interests of Coast Casinos’ Directors and Executive Officers in the Merger

In considering the recommendation of the Coast Casinos board of directors to approve the merger agreement, Coast Casinos stockholders should consider that some of Coast Casinos’ directors and officers have interests in the merger that differ from, or are in addition to, their interests as Coast Casinos stockholders. The Coast Casinos board of directors was aware of these interests and considered them, among other matters, in approving the merger and adopting the merger agreement.

As a result of these interests, these directors and officers could be more likely to vote to approve the merger agreement than if they did not hold these interests, and may have reasons for doing so that are not the same as the interests of Coast Casinos’ other stockholders. Coast Casinos stockholders should consider whether these interests may have influenced these directors and officers to support or recommend the approval of the merger agreement.

•

Merger Consideration for Michael J. Gaughan and Franklin Toti. The merger agreement provides that, in connection with the merger, each share of Coast Casinos common stock held by Messrs. Gaughan and Toti will be converted into the right to receive 32.8025 shares of Boyd Gaming common stock. As a result, unlike other Coast Casinos stockholders, the entire merger consideration to be received by

Messrs. Gaughan and Toti will consist entirely of Boyd Gaming common stock. While the receipt of merger consideration consisting entirely of Boyd Gaming common stock will subject Messrs. Gaughan and Toti to the risk of any decrease in the value of Boyd Gaming common stock between the date of the merger agreement and the effective time of the merger, it will also allow them to participate in any increase in the value of Boyd Gaming common stock during that period and subsequent to the merger. In addition, since the merger consideration to be received by Messrs. Gaughan and Toti in the merger consists entirely of Boyd Gaming common stock, the merger will be a tax-free transaction from the perspective of Messrs. Gaughan and Toti.

•

Merger Consideration for Jerry Herbst. The merger agreement provides that, in connection with the merger, each share of Coast Casinos common stock held by Mr. Herbst will be converted into the right to receive $550 in cash. As a result, unlike other Coast Casinos stockholders, the entire merger consideration to be received by Mr. Herbst will consist entirely of cash, allowing Mr. Herbst to avoid the risk of any decrease in the value of Boyd Gaming common stock between the date of the merger agreement and the effective time of the merger.

•

Post-Merger Board Membership. In connection with the merger, the members of the Coast Casinos board of directors, with the exception of Mr. Gaughan, will not serve as directors on the board of directors of the new Coast Casinos, Inc., which will operate as a wholly owned subsidiary of Boyd Gaming. Under the terms of the merger agreement, however, Boyd Gaming has agreed to include Mr. Gaughan and two other people who Mr. Gaughan designates and who are satisfactory to Boyd Gaming as directors on the Boyd Gaming board of directors. One such designee, Peter M. Thomas, is being proposed as a nominee for the Boyd Gaming board of directors at the Boyd Gaming Meeting, and Mr. Gaughan and his other designee will become directors of Boyd Gaming after the closing date of the merger and after the receipt of all necessary regulatory approvals. See Chapter II—Information About the Boyd Gaming Annual Meeting and Other Proposals.

•

Assumption and Cash-Out of Employee Stock Options. Harlan Braaten, the President and Chief Operating Officer of Coast Casinos, and Gage Parrish, the Vice President and Chief Financial Officer of Coast Casinos, have received stock options under Coast Casinos’ 1996 Stock Incentive Plan. Under the terms of the merger agreement, Boyd Gaming has agreed to assume the obligations of Coast Casinos under its 1996 Stock Incentive Plan, except for any Coast Casinos stock option that is not an incentive stock option within the meaning of Section 422 of the Internal Revenue Code. In connection with the merger, each such incentive stock option will be adjusted into an option to acquire 32.8025 shares of Boyd Gaming common stock at an exercise price of $3.04855 per share. Each such non-qualifying stock option will be canceled immediately prior to the merger and the holder thereof will be entitled to receive an amount in cash equal to the excess of $550 over the per share exercise price of such non-qualifying option. As a result of the operation of these provisions, Mr. Braaten is expected to receive $12,336,750 for the cancellation of his non-qualifying stock options and new options to purchase approximately 98,407 shares of Boyd Gaming common stock at an exercise price of $3.04855 per share, and Mr. Parrish is expected to receive $900,000 for the cancellation of his non-qualifying stock options and new options to purchase approximately 98,407 shares of Boyd Gaming common stock at an exercise price of $3.04855 per share. For a complete description of the treatment of Coast Casinos employee stock options in the merger, see “The Merger Agreement—Coast Casinos Stock Options and Benefit Plans—Coast Casinos Stock Options.”

•

Employment Arrangements. Messrs. Gaughan, Toti, Braaten and Parrish will be employed by Boyd Gaming upon consummation of the merger and, after the effective time of the merger, Messrs. Gaughan, Toti, Braaten and Parrish will continue to run the operations of the new Coast Casinos, Inc.

•

Indemnification. The merger agreement provides that, after the effective time of the merger, Boyd Gaming will, to the fullest extent permitted by law, cause the new Coast Casinos, Inc. to honor all of Coast Casinos’ obligations to indemnify the current or former directors and officers of Coast Casinos for acts or omissions by such directors and officers occurring prior to the effective time of the merger, to the extent that such obligations of Coast Casinos existed on the date of the merger agreement. Boyd

Gaming has agreed to maintain in effect the current Coast Casinos’ policies of directors’ and officers’ liability insurance for a period of six years after the effective time of the merger. However, Boyd Gaming will not be obligated to make annual premium payments in excess of 175% of the annual premiums paid by Coast Casinos as of the date of the merger agreement, which is referred to as the “maximum premium.” If the insurance coverage cannot be obtained at all, or can only be obtained at an annual premium in excess of the maximum premium, Boyd Gaming will maintain the most advantageous policies of directors’ and officers’ insurance obtainable for an annual premium equal to the maximum premium. For a complete description of the indemnification rights of Coast Casinos’ directors and officers after the effective time of the merger, see “The Merger Agreement—Indemnification.”

Stockholders Agreement

On February 6, 2004, as an inducement to Boyd Gaming entering into the merger agreement, Boyd Gaming entered into a stockholders agreement with Messrs. Gaughan, Herbst and Toti, who, as of that date, owned in the aggregate approximately 56% of the outstanding shares of Coast Casinos common stock. Pursuant to the stockholders agreement, each of the stockholders party to the stockholders agreement has agreed to vote, or cause to be voted, the shares of Coast Casinos common stock owned by him in favor of the approval of the merger agreement and the merger. In addition, each of the stockholders party to the stockholders agreement has agreed to vote, or cause to be voted, the shares of Coast Casinos common stock owned by him against, and to not consent to, and cause those shares not to be consented to, any of the following:

•

any merger agreement or merger, other than the merger agreement entered into by Coast Casinos with Boyd Gaming and the merger of Coast Casinos with and into BGC, Inc., or any consolidation, combination, sale of substantial assets, joint venture, binding share exchange, reorganization, recapitalization, dissolution, liquidation or winding up of or by Coast Casinos;

•

any takeover proposal for Coast Casinos, as defined below under “The Merger Agreement—No Solicitation”; or

•

any amendment of the articles of incorporation or by-laws of Coast Casinos or other proposal, action or transaction involving Coast Casinos or any of its stockholders, which amendment or other proposal, action or transaction would reasonably be expected to in any manner impede, frustrate, interfere with, delay, prevent or nullify any provision of the merger agreement, the merger or any other transaction contemplated by the merger agreement or the consummation of the transactions contemplated by the stockholders agreement, or change in any manner the voting rights of any class of capital stock of Coast Casinos.

The stockholders party to the stockholders agreement have agreed not to take any action inconsistent with the agreements described in the immediately preceding sentence. In addition, pursuant to the stockholders agreement, each of the stockholders party to the stockholders agreement has granted to Boyd Gaming an irrevocable proxy to vote all of his shares of Coast Casinos common stock in the manner described in the immediately preceding paragraph.

The stockholders agreement also provides, among other things, that each of the stockholders party to the stockholders agreement will not:

•

sell, transfer, pledge, assign or otherwise dispose of, or consent to or permit any sale, transfer, pledge, assignment or other disposition, or enter into a contract, option or other arrangement with respect to any sale, transfer, pledge, assignment or other disposition of any of his shares of Coast Casinos common stock or any interest in those shares, to any person, except by operation of law in the merger;

•

enter into any voting arrangement, whether by proxy, voting agreement or otherwise, with respect to his shares of Coast Casinos common stock, other than the stockholders agreement; or

•

take any action which would, or could reasonably be expected to, result in a diminution of the voting power represented by any of his shares of Coast Casinos common stock.

The stockholders party to the stockholders agreement have agreed not to commit or agree to take any of the actions described in the immediately preceding paragraph. In addition, the stockholders party to the stockholders agreement have agreed to waive any rights to dissent from the merger and to not commence or participate in, and to take all actions necessary to opt out of any class in any class action with respect to, any claim, derivative or otherwise, against Coast Casinos or any of its respective successors relating to the negotiation, execution and delivery of the stockholders agreement or the merger agreement or the consummation of the merger or any of the other transactions contemplated in the stockholders agreement or the merger agreement.

In addition, each of Messrs. Gaughan and Toti have agreed to enter into an additional stockholders agreement with Boyd Gaming and William S. Boyd regarding certain restrictions on the transfer of the shares of Boyd Gaming common stock to be received by him in the merger, including a right of first offer with respect to those shares of Boyd Gaming common stock in favor of Boyd Gaming first and then Mr. Boyd. Notwithstanding the foregoing, each of Messrs. Gaughan and Toti will be permitted to transfer the shares of Boyd Gaming common stock to be received by him in the merger to certain permitted transferees, including his estate.

The stockholders agreement will terminate upon the earliest of:

•

the effective time of the merger;

•

the termination of the merger agreement:

—

by mutual written consent of Boyd Gaming, BGC, Inc. and Coast Casinos;

—

by either Boyd Gaming or Coast Casinos if any governmental entity issues an order, decree or ruling or takes any other action, which action has become final and nonappealable, permanently enjoining, restraining or otherwise prohibiting the merger;

—

by either Boyd Gaming or Coast Casinos if the Boyd Gaming stockholders fail to approve the issuance of shares of Boyd Gaming common stock in the merger at the Boyd Gaming Meeting;

—

by Boyd Gaming if the aggregate number of shares of Boyd Gaming common stock required to be issued by Boyd Gaming in the merger in accordance with the terms described under “The Merger Agreement—Consideration to be Received in the Merger” would exceed 7,837,077 shares of Boyd Gaming common stock; or

—

by Coast Casinos if Boyd Gaming breaches or fails to perform in any material respect any of its representations, warranties or covenants in the merger agreement, which breach or failure to perform would give rise to a failure of a condition set forth in the merger agreement and which breach or failure to perform cannot be or has not been cured within 30 days after the giving of written notice to Boyd Gaming of such breach;

provided

that Coast Casinos is not in breach of any of its obligations under the merger agreement and none of the stockholders party to the stockholders agreement are in breach of any of their obligations under the stockholders agreement; and

•

two years after the date of the stockholders agreement.

Governmental and Regulatory Matters

United States Antitrust

Under the HSR Act, and the rules that have been promulgated thereunder by the Federal Trade Commission, which is referred to as the “FTC,” certain acquisition transactions may not be consummated unless information has been furnished to the Antitrust Division of the United States Department of Justice, which is referred to as the “Antitrust Division,” and the FTC and waiting period requirements have been satisfied. The merger is subject to these requirements. Pursuant to the requirements of the HSR Act, Boyd Gaming completed the filing of the required Notification and Report Forms, which are referred to as the “Forms,” with the Antitrust Division and the

FTC on March 5, 2004. Coast Casinos filed the Forms on March 5, 2004. Early termination of the statutory waiting period applicable to the merger pursuant to the HSR Act was granted by the FTC, effective as of March 17, 2004.

The Antitrust Division and the FTC frequently scrutinize the legality of transactions under the antitrust laws. At any time before or after the consummation of any such transaction, the Antitrust Division or the FTC could, notwithstanding termination of the waiting period, take any action under the antitrust laws as it deems necessary or desirable in the public interest, including seeking to enjoin the merger or seeking divestiture of Boyd Gaming’s or Coast Casinos’ assets. Private parties and State Attorneys General may also bring legal actions under the antitrust laws. Boyd Gaming is not obligated under the merger agreement to take specified actions, including disposing any of its assets or limiting its freedom of action with respect to any of its businesses, in order to obtain any consents, approvals, permits or authorizations or to remove any impediments to the merger relating to the HSR Act or other antitrust regulations. If, as a result of any such inaction on the part of Boyd Gaming, any necessary consent or approval is not obtained, each of Boyd Gaming and Coast Casinos will have the right to terminate the merger agreement. See “The Merger Agreement—Termination.”

Boyd Gaming and Coast Casinos do not believe that the merger will violate U.S. Federal antitrust laws.

Gaming Regulation

The gaming operations of each of Boyd Gaming and Coast Casinos are subject to extensive regulation, and each of Boyd Gaming, Coast Casinos and their respective subsidiaries hold registrations, approvals, gaming licenses or permits in each jurisdiction in which it operates gaming activities. In each such jurisdiction, certain regulatory requirements must be complied with and/or certain approvals must be obtained in connection with the merger. Boyd Gaming’s and Coast Casinos’ respective obligations to consummate the merger are conditioned upon all necessary gaming regulatory approvals and authorizations having been obtained. See “Risk Factors—Risks Relating to the Merger—Delay in regulatory approvals will delay and possibly prevent the merger.”

The following is only a summary of the various applicable gaming regulatory requirements with respect to the merger and the respective operations of Boyd Gaming and Coast Casinos. For a complete description of such regulatory requirements, see “Governmental Gaming Regulation” in the Annual Report on Form 10-K for the fiscal year ended December 31, 2003 for Boyd Gaming and “Nevada Regulation and Licensing” in the Annual Report on Form 10-K for the fiscal year ended December 31, 2003 for Coast Casinos. See Chapter IV—Additional Information. The failure to obtain the required approval of the merger and the issuance of shares of Boyd Gaming common stock or the failure to comply with the procedural requirements prescribed by any applicable gaming regulatory authority or the failure of Boyd Gaming or Coast Casinos to qualify or make disclosures or applications as required under the laws and regulations of any applicable gaming regulatory authority, in each case as described below or in the information incorporated by reference in this joint proxy statement/prospectus, may result in the loss of license or denial of application for licensure in any such jurisdiction.

Nevada Regulatory Approval. Boyd Gaming has filed an application with the Nevada State Gaming Control Board, which is referred to as the “Nevada Control Board,” for approval of the acquisition of control of Coast Casinos and will file related applications with all appropriate local jurisdictions. Nevada is the sole state jurisdiction in which Coast Casinos conducts gaming and Nevada therefore has primary jurisdiction for approval of the merger.

As described below, changes in control of Coast Casinos through merger, consolidation, stock or asset acquisitions, management or consulting agreements, or any act or conduct by a person whereby control is obtained, may not occur without the prior approval of the Nevada Gaming Commission, which is referred to as the “Nevada Commission,” acting upon the recommendation of the Nevada Control Board. Entities seeking to acquire control of a registered, publicly traded gaming corporation must satisfy the Nevada Control Board and the Nevada Commission in a variety of stringent standards prior to assuming control of such registered, publicly

traded gaming corporation. The Nevada Commission may also require controlling stockholders, executive officers, directors, and other persons having a material relationship or involvement with the entity proposing to acquire control to be investigated and licensed or found suitable as part of the approval process relating to the transaction. The merger requires the prior approval of the Nevada Commission.

The ownership and operation of casino gaming facilities in Nevada are subject to the Nevada Gaming Control Act and the regulations promulgated thereunder, which are referred to collectively as the “Nevada Act,” and various local regulations. Boyd Gaming’s and Coast Casinos’ gaming operations are subject to the licensing and regulatory control of the Nevada Commission, the Nevada Control Board, the Cities of Las Vegas and Henderson, and the Clark County Liquor and Gaming Licensing Board. The Nevada Commission, the Nevada Control Board, the Cities of Las Vegas and Henderson, and the Clark County Liquor and Gaming Licensing Board are collectively referred to as the “Nevada Gaming Authorities.”

Boyd Gaming has been registered by the Nevada Commission as a publicly traded corporation found suitable to own the stock of California Hotel and Casino. California Hotel and Casino is licensed by the Nevada Gaming Commission and various of the local regulatory authorities to operate non-restricted gaming activities at the California and Sam’s Town Hotel, Gambling Hall and Bowling Center, which is located in Las Vegas, Nevada, and is additionally registered as a holding corporation approved by the Nevada Commission and various local regulatory authorities to own the stock of Mare-Bear, Inc., the operator of the Stardust Resort and Casino, which is located in Las Vegas, Nevada, Sam-Will, Inc., the operator of the Fremont, Eldorado, Inc., the operator of the Eldorado Casino and Jokers Wild Casino, each of which is located in Henderson, Nevada, and M.S.W., Inc., the operator of Main Street Station. Similarly, Coast Casinos has been registered as a publicly traded corporation and found suitable by the Nevada Commission and various local regulatory authorities to own the stock of Coast Hotels. Coast Hotels is licensed and approved by the Nevada Gaming Authorities to own and operate each of the Gold Coast, the Barbary Coast, The Orleans, the Suncoast, and to conduct non-restricted gaming operations (sports pool only) at the Union Plaza Hotel and Casino and at Renata’s Club-Sports Pool. All of the foregoing are hereinafter collectively referred to as the “Gaming Subsidiaries.” The gaming licenses held by each of the respective Gaming Subsidiaries require the payment of fees and taxes and are not transferable. Each of Boyd Gaming and Coast Casinos is registered by the Nevada Commission as a publicly traded corporation and, as such, is required periodically to submit detailed financial and operating reports to the Nevada Commission and to furnish any other information which the Nevada Commission may require. Each of Boyd Gaming and Coast Casinos has obtained from the Nevada Gaming Authorities the various registrations, approvals, findings of suitability, permits and licenses required in order to engage in gaming activities in Nevada.

The Nevada Gaming Authorities may investigate any individual who has a material relationship to, or material involvement with, Boyd Gaming, Coast Casinos or the Gaming Subsidiaries in order 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 Boyd Gaming, Coast Casinos and the Gaming Subsidiaries must file applications with the Nevada Gaming Authorities and may be required to be licensed or found suitable by the Nevada Gaming Authorities. Officers, directors, and key employees who are actively and directly involved in gaming activities of Boyd Gaming or Coast Casinos may be required to be licensed or found suitable by the Nevada Gaming Authorities. Mr. Gaughan will be required to be individually found suitable to own the stock of Boyd Gaming that he will acquire in the merger, and as an executive and director of Boyd Gaming. The Nevada Gaming Authorities may deny an application for licensing for any cause that they deem reasonable. A finding of suitability is comparable to licensing, and both require submission of detailed personal and financial information followed by a thorough investigation. The applicant for licensing or a finding of suitability 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 unsuitable to continue having a relationship with Boyd Gaming, Coast Casinos or the Gaming Subsidiaries,

that entity would have to sever all relationships with such person. In addition, the Nevada Gaming Commission may require Boyd Gaming, Coast Casinos or the Gaming Subsidiaries to terminate the employment of any person who refuses to file appropriate applications. Determinations of suitability or of questions pertaining to licensing are not subject to judicial review in Nevada.

Neither Boyd Gaming nor Coast Casinos may make a public offering of its securities without the prior approval of the Nevada Commission if the securities or the proceeds therefrom are intended to be used to construct, acquire, or finance gaming facilities in Nevada, or retire or extend obligations incurred for such purposes. The Nevada Commission has previously granted Boyd Gaming approval to make offerings for a period through September 2005, subject to certain conditions, which is referred to as the “Boyd Gaming Shelf Approval.” However, the Boyd Gaming Shelf Approval may be rescinded for good cause without prior notice upon the issuance of an interlocutory stop order by the Chairman of the Nevada Control Board. Such approval does not constitute a finding, recommendation or approval by the Nevada Commission or the Nevada Control Board as to the accuracy or adequacy of the prospectus or the investment merits of the securities. Any representation to the contrary is unlawful. The issuance of Boyd Gaming common stock in connection with the acquisition of control of Coast Casinos will be made pursuant to the Boyd Gaming Shelf Approval.

Additional Gaming Regulations. Boyd Gaming is also subject to a variety of gaming regulations in the other jurisdictions in which it operates, which include Illinois, Indiana, Louisiana, Mississippi and New Jersey. Certain of the gaming regulatory authorities in these jurisdictions may require approval of certain aspects of the merger and the other transactions contemplated by the merger agreement, either prior to or after the effective date of the merger, including, without limitation:

•

in Illinois, prior approval of the financing of the merger and approval of Mr. Gaughan as a holder of 5% or more of the shares of Boyd Gaming common stock following the consummation of the merger;

•

in Indiana, notification of the offering of shares of Boyd Gaming common stock in the merger, prior approval of the financing of the merger and approval of Mr. Gaughan as a holder of 5% or more of the shares of Boyd Gaming common stock following the consummation of the merger;

•

in Louisiana, prior approval of the financing of the merger, of Mr. Gaughan as a holder of 5% or more of the shares of Boyd Gaming common stock and, subsequent to their appointment, of Mr. Gaughan and his two designees to the Boyd Gaming board of directors;

•

in Mississippi, approval of the financing of the merger and a finding of suitability of Mr. Gaughan as a holder of 5% or more of the shares of Boyd Gaming common stock following the consummation of the merger; and

•

in New Jersey, qualification of Mr. Gaughan as a holder of 5% or more of the shares of Boyd Gaming common stock and qualification of any new members of the Boyd Gaming board of directors following consummation of the merger; provided, however, if the merger is consummated prior to the New Jersey re-licensing of Marina District Development Company, LLC, owner of 50% of Borgata Hotel & Casino, which is expected in June, such qualification must be completed on or before such re-licensing.

A full description of these gaming regulations can be found under “Governmental Gaming Regulation” in the Annual Report on Form 10-K for the fiscal year ended December 31, 2003 for Boyd Gaming, which is incorporated by reference into this joint proxy statement/prospectus. See Chapter IV—Additional Information.

Boyd Gaming intends to make all filings with the appropriate regulatory authorities and take all other actions necessary, in each case in a timely manner, to obtain the approvals necessary under all applicable gaming regulations in each of these jurisdictions in order to consummate the merger and the other transactions contemplated by the merger agreement.

U.S. Federal Income Tax Consequences of the Merger

The following discussion is the opinion of Cravath, Swaine & Moore LLP and Gibson, Dunn & Crutcher LLP, advisors to Boyd Gaming and Coast Casinos, respectively, as to the material U.S. Federal income tax consequences of the merger to Coast Casinos stockholders. This discussion is based on the Internal Revenue Code, the related Treasury regulations, administrative interpretations and court decisions, all of which are subject to change, possibly with retroactive effect. Any such change could affect the accuracy of the statements and the conclusions discussed below and the tax consequences of the merger. This discussion applies only to Coast Casinos stockholders that hold their shares of Coast Casinos common stock, and will hold the shares of Boyd Gaming common stock, if any, received in exchange for their shares of Coast Casinos common stock, as capital assets within the meaning of Section 1221 of the Internal Revenue Code. This discussion does not address all U.S. Federal income tax consequences of the merger that may be relevant to particular holders, including holders that are subject to special tax rules. Some examples of holders that are subject to special tax rules are:

•

dealers in securities;

•

financial institutions;

•

insurance companies;

•

tax-exempt organizations;

•

holders of shares of Coast Casinos stock as part of a position in a “straddle” or as part of a “hedging” or “conversion” transaction;

•

holders who have a “functional currency” other than the U.S. dollar;

•

holders who are foreign persons;

•

holders who own their shares indirectly through partnerships, trusts or other entities that may be subject to special treatment; and

•

holders who acquired their shares of Coast Casinos common stock through stock option or stock purchase programs or otherwise as compensation.

In addition, this discussion does not address any consequences arising under the laws of any state, local or foreign jurisdiction. Coast Casinos stockholders are urged to consult their own tax advisors as to specific tax consequences to them of the merger, including the applicability and effect of any state, local or foreign tax laws and of changes in applicable tax laws.

Cravath Swaine & Moore LLP and Gibson, Dunn & Crutcher LLP have issued opinions to Boyd Gaming and Coast Casinos, respectively, to the effect that the merger will qualify as a reorganization under Section 368(a) of the Internal Revenue Code and that Boyd Gaming, BGC, Inc. and Coast Casinos will each be a party to that reorganization under Section 368(b) of the Internal Revenue Code. In addition, the obligations of Boyd Gaming and Coast Casinos to complete the merger are conditioned upon the reissuance of such opinions as of the closing date of the merger. These opinions of counsel have and will be given in reliance on customary representations of Boyd Gaming and Coast Casinos and assumptions as to certain factual matters. The opinions of counsel will not bind the courts or the Internal Revenue Service, nor will they preclude the Internal Revenue Service from adopting a position contrary to those expressed in the opinions. No assurance can be given that contrary positions will not successfully be asserted by the Internal Revenue Service or adopted by a court if the issues are litigated. Neither Boyd Gaming nor Coast Casinos intends to obtain a ruling from the Internal Revenue Service with respect to the U.S. Federal income tax consequences of the merger.

The following are the material U.S. Federal income tax consequences to Coast Casinos stockholders who, consistent with the opinions of counsel referred to above, receive their cash and shares of Boyd Gaming common stock pursuant to a transaction constituting a reorganization within the meaning of Section 368(a) of the Internal Revenue Code.

The U.S. Federal income tax consequences of the merger to each Coast Casinos stockholder will vary depending on whether the Coast Casinos stockholder receives cash, shares of Boyd Gaming common stock or a combination of cash and stock in exchange for the stockholder’s shares of Coast Casinos common stock. At the time that a Coast Casinos stockholder who has the right to elect to receive cash or shares of Boyd Gaming common stock in the merger makes such an election, the stockholder will not know if, and to what extent, the proration procedures will alter the mix of consideration to be received. As a result, the tax consequences to each stockholder will not be ascertainable with certainty until the stockholder knows the precise amount of cash or shares of Boyd Gaming common stock that he or she will receive in the merger.

Holders who Exchange Shares of Coast Casinos Common Stock Solely for Cash. Holders of Coast Casinos common stock who exchange all their shares of Coast Casinos common stock solely for cash in the merger will generally recognize gain or loss equal to the difference between the amount of cash received and the tax basis of the shares of Coast Casinos common stock exchanged. The amount and character of gain or loss will be computed separately for each block of Coast Casinos common stock that was purchased by the holder. Any recognized gain or loss will be capital gain or loss and any such capital gain or loss will be long term if, as of the effective time of the merger, such stockholder has held the shares of Coast Casinos common stock for more than one year or will be short term if, as of the effective time of the merger, such stockholder has held the shares of Coast Casinos common stock for one year or less.

Holders who Exchange Shares of Coast Casinos Common Stock Solely for Boyd Gaming Common Stock. Holders of Coast Casinos common stock who exchange all of their shares of Coast Casinos common stock solely for shares of Boyd Gaming common stock in the merger will not recognize gain or loss for U.S. Federal income tax purposes, except with respect to cash, if any, they receive in lieu of a fractional share of Boyd Gaming common stock. Each holder’s aggregate tax basis in the Boyd Gaming common stock received in the merger will be the same as his or her aggregate tax basis in the Coast Casinos common stock surrendered in the merger, decreased by the amount of any tax basis allocable to any fractional share interest for which cash is received. The holding period of the Boyd Gaming common stock received in the merger by a holder of Coast Casinos common stock will include the holding period of Coast Casinos common stock that he or she surrendered in the merger. If a Coast Casinos stockholder has differing tax bases and/or holding periods in respect of the stockholder’s shares of Coast Casinos common stock, the stockholder should consult with a tax advisor in order to identify the tax bases and/or holding periods of the particular shares of Boyd Gaming common stock that the stockholder receives.

Holders who Exchange Shares of Coast Casinos Common Stock for Boyd Gaming Common Stock and Cash. Coast Casinos stockholders who exchange shares of Coast Casinos common stock for a combination of shares of Boyd Gaming common stock and cash will recognize gain, but not loss, in the merger. The gain, if any, recognized will equal the lesser of:

•

the amount of cash received in the merger; and

•

the amount of gain realized in the merger.

The amount of gain that is realized in the merger will equal the excess of:

•

the sum of the cash plus the fair market value of the Boyd Gaming common stock received in the merger, over

•

the tax basis of the shares of Coast Casinos common stock surrendered in the merger.

For this purpose, a Coast Casinos stockholder must calculate gain or loss separately for each identifiable block of shares of Coast Casinos common stock that such stockholder surrenders pursuant to the merger, and a Coast Casinos stockholder cannot offset a loss recognized on one block of such shares of Coast Casinos common stock against a gain recognized on another block of such shares of Coast Casinos common stock. Any gain recognized generally will be treated as capital gain, except that if the stockholder receives cash in the merger, the

stockholder’s gain could be treated as a dividend if the receipt of the cash has the effect of the distribution of a dividend for U.S. Federal income tax purposes under Sections 302 and 356 of the Internal Revenue Code. The aggregate tax basis in the Boyd Gaming common stock received pursuant to the merger, including the basis in any fractional share for which cash is received, will be equal to the aggregate tax basis in the Coast Casinos common stock surrendered in the merger, decreased by the amount of cash received and increased by the amount of gain, if any, recognized or any amount treated as a dividend. The holding period of the Boyd Gaming common stock received in the merger by a Coast Casinos stockholder will include the holding period of Coast Casinos common stock that he or she surrendered in exchange therefor. Cash received and gain realized in connection with the receipt of cash in lieu of a fractional share of common stock are not taken into account in making the computations of gain realized or recognized and basis in the shares received. Rather, such cash and gain are treated as described below.

The Receipt of Cash in Lieu of a Fractional Share. A holder of Coast Casinos common stock who receives cash in lieu of a fractional share of Boyd Gaming common stock will generally recognize gain or loss equal to the difference between the amount of cash received and his or her tax basis in the Boyd Gaming common stock that is allocable to the fractional share. That gain or loss generally will constitute capital gain or loss.

Tax Consequences if the Merger Does Not Qualify as a Reorganization under Section 368(a) of the Internal Revenue Code. If the Internal Revenue Service determines successfully that the acquisition of Coast Casinos does not qualify as a reorganization within the meaning of Section 368(a) of the Internal Revenue Code, Coast Casinos stockholders would be required to recognize gain or loss with respect to each share of Coast Casinos common stock surrendered in the merger in an amount equal to the difference between:

•

the sum of the fair market value of any Boyd Gaming common stock and cash received in the merger; and

•

the tax basis of the shares of Coast Casinos common stock surrendered in exchange therefor.

The amount and character of gain or loss will be computed separately for each block of Coast Casinos common stock that was purchased by the Coast Casinos stockholder. A Coast Casinos stockholder’s aggregate tax basis in the Boyd Gaming common stock received in the merger would, in this case, equal its fair market value at the time of the closing of the merger, and the holding period for the Boyd Gaming common stock will begin the day after the closing of the merger.

If, as a result of a decline in the sale price of a share of Boyd Gaming common stock between the date of the merger agreement and the anticipated closing date of the merger, the number of shares of Boyd Gaming common stock required to be issued in the merger to the minority stockholders to ensure that the merger qualifies as a reorganization within the meaning of Section 368(a) of the Internal Revenue Code exceeds 7,837,077 shares of Boyd Gaming common stock, then Boyd Gaming will have the right to terminate the merger agreement. For a full description of the adjustment of merger consideration for tax reasons, including a description of Boyd Gaming’s right to terminate the merger agreement, see “The Merger Agreement—Consideration to be Received in the Merger—Adjustments to the Merger Consideration and Proration” and “The Merger Agreement—Termination.”

Information Reporting and Backup Withholding. Certain U.S. stockholders may be subject to information reporting with respect to the cash received in exchange for Coast Casinos common stock, including cash received in lieu of a fractional share interest in shares of Boyd Gaming common stock. U.S. stockholders who are subject to information reporting and who do not provide appropriate information when requested may also be subject to backup withholding. Any amount withheld under such rules is not an additional tax and may be refunded or credited against such U.S. stockholder’s U.S. Federal income tax liability, provided that the required information is properly furnished in a timely manner to the Internal Revenue Service.

Dissenters’ Rights of Coast Casinos Stockholders

Under Chapter 92A of the NRS, dissenters’ rights are available to a corporation’s stockholders in connection with certain mergers and consolidations. A Coast Casinos stockholder who follows the procedures specified in NRS Sections 92A.300 through 92A.500, inclusive, is entitled to dissent from the merger and obtain payment of the fair value of his or her shares of Coast Casinos common stock in lieu of the merger consideration. In order to exercise dissenters’ rights, a stockholder must demand and perfect the rights in accordance with NRS Chapter 92A. The following summarizes provisions of Chapter 92A of the NRS regarding dissenters’ rights that would be applicable in connection with the merger. This discussion is qualified in its entirety by reference to NRS Sections 92A.300 to 92A.500, inclusive. Annex D to this joint proxy statement/prospectus contains a copy of NRS Sections 92A.300 through 92A.500, inclusive. If you fail to take any action required by Nevada law, your rights to dissent in connection with the merger will be waived or terminated.

If a Coast Casinos stockholder elects to exercise his or her dissenters’ rights, the stockholder must:

•

file with Coast Casinos, prior to the vote seeking approval of the merger agreement and the merger, a written notice of the stockholder’s intent to demand payment for his or her shares if the merger is effectuated; and

•

not vote in favor of approving the merger agreement and the merger.

A beneficial stockholder of Coast Casinos stock may assert dissenters’ rights as to shares held on the stockholder’s behalf only if the stockholder submits to Coast Casinos the written consent of the stockholder of record to the dissent not later than the time the beneficial stockholder asserts dissenters’ rights and the beneficial stockholder does so with respect to all shares of which he or she is the beneficial stockholder or over which he or she has the power to direct the vote. A stockholder of record may assert dissenters’ rights as to fewer than all of the shares registered in his or her name only if the stockholder dissents with respect to all shares beneficially owned by any one person and notifies Coast Casinos in writing of the name and address of each person on whose behalf the stockholder of record asserts dissenters’ rights. The rights of a partial dissenter under NRS Chapter 92A are determined as if the Coast Casinos shares as to which the stockholder of record dissents and such stockholder’s other Coast Casinos shares were registered in the names of different stockholders.

A Coast Casinos stockholder who satisfies the requirements of the two preceding paragraphs is referred to as a “dissenter.” All notices of intent to demand dissenters’ rights should be addressed to Coast Casinos, Attn: Corporate Secretary at 4500 West Tropicana Avenue, Las Vegas, Nevada 89103, before the vote is taken on the merger agreement and the merger at the Coast Casinos Meeting, and should be executed by, or on behalf of, the holder of record. Such demand reasonably must inform Coast Casinos of the identity of the stockholder and that such stockholder intends to demand appraisal of such stockholder’s shares of Coast Casinos common stock. After the effective time of the merger, any notices or demands relating to dissenters’ rights should be sent to the new Coast Casinos, Inc., Attn: Corporate Secretary at 4500 West Tropicana Avenue, Las Vegas, Nevada 89103.

Within 10 days after the effective time of the merger, the new Coast Casinos, Inc. will send notice of the effective time of the merger and the availability of dissenters’ rights to each dissenter. The notice will:

•

state where the demand for payment must be sent and where and when certificates for Coast Casinos shares are to be deposited;

•

supply a form for demanding payment;

•

set a date by which the new Coast Casinos, Inc. must receive the demand for payment, which may not be less than 30 nor more than 60 days after the date the notice is delivered; and

•

be accompanied by a copy of NRS Sections 92A.300 through 92A.500, inclusive.

A dissenter must, by the date set forth in the dissenter’s notice described above:

•

demand payment;

•

certify whether the stockholder or the beneficial owner on whose behalf the stockholder is dissenting, as the case may be, acquired beneficial ownership of the shares before the date of the first announcement to the news media or to the stockholders of the terms of the merger; and

•

deposit his or her certificates in accordance with the terms of the dissenter’s notice.

Coast Casinos stockholders who do not demand payment or deposit their certificates where required, each by the date set forth in the dissenter’s notice, will not be entitled to demand payment for their shares under Nevada law governing dissenters’ rights.

Within 30 days after receipt of a demand for payment, the new Coast Casinos, Inc. will pay each dissenter who complied with NRS Section 92A.440 the amount that the new Coast Casinos, Inc. estimates to be the fair value of the shares, plus accrued interest. The payment will be accompanied by:

•

Coast Casinos’ balance sheet as of the end of a fiscal year ending not more than 16 months before the date of payment, a statement of income for that fiscal year, a statement of changes in stockholders’ equity for that fiscal year and the latest available interim financial statements, if any;

•

a statement of the new Coast Casinos, Inc.’s estimate of the fair value of the shares;

•

an explanation of how the interest was calculated;

•

a statement of the dissenter’s rights to demand payment under NRS Section 92A.480; and

•

a copy of NRS Sections 92A.300 through 92A.500, inclusive.

The new Coast Casinos, Inc. may elect to withhold payment from a dissenting stockholder if such stockholder became the beneficial owner of the shares on or after the date of the first announcement to the news media or to the stockholders of the proposed terms of the merger. To the extent the new Coast Casinos, Inc. elects to withhold payment, after effectuating the merger, it will estimate the fair value of the shares, plus accrued interest, and will offer to pay this amount to each dissenter who agrees to accept it in full satisfaction of the stockholder’s demand. The new Coast Casinos, Inc. will send with its offer:

•

a statement of the new Coast Casinos, Inc.’s estimate of the fair value of the shares;

•

an explanation of how the interest was calculated; and

•

a statement of dissenters’ rights to demand payment pursuant to NRS Section 92A.480.

A dissenter may notify Coast Casinos in writing of the dissenter’s own estimate of the fair value of the shares and interest due, and demand payment of his or her estimate, less the new Coast Casinos, Inc.’s fair value payment, or, in the case where payment to an after-acquiring dissenter has been withheld, reject the offer for payment made by the new Coast Casinos, Inc. and demand payment of the fair value of the dissenter’s shares and interest due if the dissenter believes that the amount paid or offered is less than the fair value of the dissenter’s shares or that the interest due is incorrectly calculated. A dissenter waives his right to demand such payment unless the dissenter notifies the new Coast Casinos, Inc. of his demand in writing within 30 days after the new Coast Casinos, Inc. made or offered payment for the dissenter’s shares.

If a demand for payment remains unsettled, the new Coast Casinos, Inc. will commence a proceeding within 60 days after receiving the demand for payment and petition the court of proper jurisdiction to determine the fair value of the shares of Coast Casinos common stock and accrued interest. If the new Coast Casinos, Inc. does not commence the proceeding within the 60-day period, it will be required to pay each dissenter whose demand remains unsettled the amount demanded.

Each dissenter who is made a party to the proceeding is entitled to a judgment:

•

for the amount, if any, by which the court finds the fair value of the dissenter’s shares, plus interest, exceeds the amount paid by the new Coast Casinos, Inc.; or

•

for the fair value, plus accrued interest, of the dissenter’s after-acquired shares for which the new Coast Casinos, Inc. elected to withhold payment pursuant to Nevada law.

Under NRS Chapter 92A, the fair value of a dissenter’s shares of Coast Casinos common stock means the value of the shares immediately before the consummation of the merger, excluding any appreciation or depreciation in value in anticipation of the merger, unless excluding such appreciation or depreciation would be inequitable.

The court will determine all of the costs of the proceeding, including the reasonable compensation and expenses of any appraisers appointed by the court. The court will assess the costs against the new Coast Casinos, Inc., except that the court may assess costs against all or some of the dissenters, in the amounts the court finds equitable, to the extent that the court finds the dissenters acted arbitrarily, vexatiously or not in good faith in demanding payment. The court may also assess the fees and expenses of the counsel and experts for the respective parties, in amounts the court finds equitable:

•

against Coast Casinos and in favor of all dissenters if the court finds the new Coast Casinos, Inc. did not substantially comply with NRS Sections 92A.300 through 92A.500, inclusive; or

•

against either the new Coast Casinos, Inc. or a dissenter in favor of any other party, if the court finds that the party against whom the fees and expenses are assessed acted arbitrarily, vexatiously or not in good faith with respect to the dissenters’ rights provided by NRS Sections 92A.300 through 92A.500, inclusive.

If the court finds that the services of counsel for any dissenter were of substantial benefit to other dissenters similarly situated, and that the fees for those services should not be assessed against the new Coast Casinos, Inc., the court may award to those counsel reasonable fees to be paid out of the amounts awarded to the dissenters who were benefited.

If a proceeding is commenced because the new Coast Casinos, Inc. did not pay each dissenter who complied with the procedures described by the Nevada dissenters’ rights statute the amount the new Coast Casinos, Inc. estimated to be the fair value of the shares, plus accrued interest, within 30 days after receipt of a valid demand for payment, the court may assess costs against the new Coast Casinos, Inc., except that the court may assess costs against all or some of the dissenters who are parties to the proceeding, in amounts the court finds equitable, to the extent the court finds that such parties did not act in good faith in instituting the proceeding. The assessment of costs and fees, if any, may also be affected by Nevada law governing offers of judgment.

The foregoing summary of the rights of dissenting Coast Casinos stockholders does not purport to be a complete statement of such rights and the procedures to be followed by stockholders desiring to exercise any available dissenters’ rights. The preservation and exercise of dissenters’ rights require strict adherence to NRS Sections 92A.300 through 92A.500, inclusive, a copy of which is attached as Annex D to this joint proxy statement/prospectus.

Notwithstanding the foregoing, Messrs. Gaughan, Herbst and Toti have agreed in the stockholders agreement to waive any rights that they have to dissent from the merger, as described above under “—Stockholders Agreement.” In addition, the Boyd Gaming stockholders will not have dissenters’ rights under Nevada law as a result of the merger.

Plans for Coast Casinos After the Merger

After the effective time of the merger, Boyd Gaming anticipates that Coast Casinos will continue its current operations, except that it will cease to be an independently owned company and will instead be a wholly owned subsidiary of Boyd Gaming. After the effective time of the merger, the directors of BGC, Inc. immediately prior to the effective time of the merger, together with Mr. Gaughan, will become the directors of the new Coast Casinos, Inc., and the officers of Coast Casinos immediately prior to the effective time of the merger will become the officers of the new Coast Casinos, Inc., in each case until the earlier of their resignation or removal or until their respective successors are duly elected or appointed and qualified, as the case may be.

Except as set forth in this joint proxy statement/prospectus, neither Boyd Gaming nor, to the best of Boyd Gaming’s knowledge, any of its directors, executive officers or other affiliates had any transactions with Coast Casinos or any of its directors, executive officers or other affiliates that would require disclosure under the rules and regulations of the SEC applicable to this joint proxy statement/prospectus. Except as set forth in this joint proxy statement/prospectus, neither Coast Casinos, nor, to the best of Coast Casinos’ knowledge, any of its directors, executive officers or other affiliates had any transactions with Boyd Gaming or any of its directors, executive officers or other affiliates that would require disclosure under the rules and regulations of the SEC applicable to this joint proxy statement/prospectus. As of the date of this joint proxy statement/prospectus, Boyd Gaming does not own any shares of Coast Casinos common stock.

Accounting Treatment

Boyd will account for the merger under the purchase method of accounting for business combinations under accounting principles generally accepted in the United States of America, which means that the assets and liabilities of Coast Casinos will be recorded, as of the completion of the merger, at their fair values and added to those of Boyd Gaming.

Deregistration of Coast Casinos Common Stock

Upon consummation of the merger, shares of Coast Casinos common stock will be deregistered under the Securities Exchange Act of 1934, which is referred to as the “Exchange Act.”

Listing of Boyd Gaming Common Stock

Boyd Gaming common stock currently is listed on the New York Stock Exchange under the symbol “BYD.” Boyd Gaming has agreed in the merger agreement to use all reasonable efforts to cause the shares of Boyd Gaming common stock to be issued in the merger to be approved for listing on the New York Stock Exchange, subject to official notice of issuance, prior to the closing date of the merger. Listing of these shares of Boyd Gaming common stock on the New York Stock Exchange, subject to official notice of issuance, is a condition to closing the merger.

Impact of Increased Indebtedness on Dividends

Boyd Gaming’s outstanding debt will increase following the merger. See “Risk Factors—Risks Relating to the Merger—Boyd Gaming will have more indebtedness after the merger, which could adversely affect its cash flows and business.” In connection with the Financing and Boyd Gaming’s existing indebtedness, Boyd Gaming will be required to remain compliant with the covenants that limit Boyd Gaming’s ability to pay dividends on Boyd Gaming common stock.

The increased debt could prevent Boyd Gaming’s payment of dividends if such payment would cause a breach of the covenants in Boyd Gaming’s debt instruments. Boyd Gaming will be party to a bank credit facility that contains customary conditions to borrowing, including compliance with certain financial covenants. Under the bank credit facility, Boyd Gaming’s ability to pay dividends will depend on maintaining compliance with such covenants after giving effect to the payment of dividends.

THE MERGER AGREEMENT

The following description of the material provisions of the merger agreement is qualified by reference to the text of the Agreement and Plan of Merger dated as of February 6, 2004, as amended, among Boyd Gaming, BGC, Inc. and Coast Casinos, a copy of which is attached as Annex A and is incorporated by reference in this joint proxy statement/prospectus. All Boyd Gaming stockholders and Coast Casinos stockholders are encouraged to read the Agreement and Plan of Merger in its entirety for a more complete description of the terms and conditions to the merger.

The Merger

At the effective time of the merger, Coast Casinos will be merged with and into BGC, Inc., a direct wholly owned subsidiary of Boyd Gaming. BGC, Inc. will continue as the surviving corporation. The articles of incorporation of BGC, Inc. will be amended at the effective time to change the name of the surviving corporation to “Coast Casinos, Inc.” BGC, Inc. was created solely for the purpose of the merger and has no material assets or operations of its own.

Closing and Effective Time of the Merger

The closing of the merger will take place on the second business day following the satisfaction or waiver of the conditions described below under “—Conditions to the Merger,” unless Boyd Gaming and Coast Casinos agree in writing to another time.

The merger will become effective at the time the articles of merger are filed with the Nevada Secretary of State, or at a later time agreed to by Boyd Gaming and Coast Casinos in the articles of merger. The articles of merger will be filed by BGC, Inc. on the closing date of the merger.

Directors and Officers of the Surviving Corporation

At the effective time of the merger, the directors of BGC, Inc. immediately prior to the effective time of the merger, together with Mr. Gaughan, will become the directors of the new Coast Casinos, Inc., and the officers of Coast Casinos immediately prior to the effective time of the merger will become the officers of the new Coast Casinos, Inc., in each case until the earlier of their resignation or removal or until their respective successors are duly elected or appointed and qualified, as the case may be.

Consideration to be Received in the Merger

General

The merger agreement provides that at the effective time of the merger, each issued and outstanding share of Coast Casinos common stock held by Messrs. Gaughan and Toti will be converted into the right to receive 32.8025 shares of Boyd Gaming common stock. In addition, the merger agreement provides that at the effective time of the merger, each issued and outstanding share of Coast Casinos common stock held by Mr. Herbst will be converted into the right to receive $550 in cash.

The merger agreement provides that at the effective time of the merger, each issued and outstanding share of Coast Casinos common stock held by a minority stockholder will be converted into the right to receive, at the election of the minority stockholder, and subject to limitations described below under “—Consideration to be Received in the Merger—Adjustments to the Merger Consideration and Proration,” 32.8025 shares of Boyd Gaming common stock. Shares of Coast Casinos common stock with respect to which an election has not been made by a minority stockholder will be converted into the right to receive $550 in cash per share of Coast Casinos common stock. If, between the date of the merger agreement and the effective time of the merger, the

outstanding shares of Boyd Gaming common stock are changed into a different number of shares or a different class by reason of any reclassification, recapitalization, split-up, combination, exchange of shares or readjustment, or a stock dividend on shares of Boyd Gaming common stock is declared with a record date between the date of the merger agreement and the effective time of the merger, the exchange ratio with respect to stock consideration received in the merger will be correspondingly adjusted.

Adjustments to the Merger Consideration and Proration

The merger has been structured, and adjustments to the elections of the minority stockholders will be made by the exchange agent, so that the maximum aggregate number of shares of Boyd Gaming common stock to be issued to minority stockholders does not exceed 1,009,194 shares, which amount is referred to as the “target stock amount,” and the maximum aggregate amount of cash to be paid to minority stockholders does not exceed $336,170,276.20, which amount is referred to as the “cash cap.” However, if, on the second business day following the satisfaction or waiver of all conditions to the merger described below under “—Conditions to the Merger,” which date is referred to as the “Date of Determination,” the merger would not qualify as a reorganization within the meaning of Section 368(a) of the Internal Revenue Code solely by reason of the average of the high and low sale price of a share of Boyd Gaming common stock on the New York Stock Exchange on the Date of Determination, then the target stock amount, and the exchange ratio with respect to those shares of Boyd Gaming common stock to be issued to minority stockholders, will be increased and the cash cap, and the amount of cash to be exchanged per share of Coast Casinos common stock, will be decreased, in each case in an amount sufficient to provide that, on the closing date:

•

40% of the aggregate amount of all merger consideration, including consideration offered to Coast Casinos stockholders other than the minority stockholders, will consist of shares of Boyd Gaming common stock, with the value of each share of Boyd Gaming common stock being the average of the high and low sale price of a share of Boyd Gaming common stock on the New York Stock Exchange on the Date of Determination; and

•

the value of the merger consideration payable in respect of each share of Coast Casinos common stock held by a minority stockholder will be equal to $550.

If, after this adjustment, the target stock amount would exceed 7,837,077 shares of Boyd Gaming common stock, then Boyd Gaming will have the right to terminate the merger agreement as described below under “—Termination.”

If the aggregate number of shares of Boyd Gaming common stock elected by minority stockholders exceeds the target stock amount, as adjusted, then the exchange agent will allocate, pro rata to those minority stockholders making the election for stock consideration in accordance with the number of shares of Coast Casinos common stock with respect to which they elect to receive stock consideration, a sufficient number of shares of Coast Casinos common stock to be converted into cash consideration instead of stock consideration so that the aggregate number of shares of Boyd Gaming common stock issued to the minority stockholders equals approximately the target stock amount (subject to the rounding mechanics of the proration provisions of the merger agreement), as adjusted in accordance with the terms of the merger agreement.

If the aggregate amount of cash to be paid to minority stockholders following the election exceeds the cash cap, as adjusted, then the exchange agent will allocate, pro rata to those minority stockholders not making an election for stock consideration in accordance with the number of shares of Coast Casinos common stock with respect to which they are not making an election to receive stock consideration, a sufficient number of shares of Coast Casinos common stock to be converted into stock consideration instead of cash consideration so that the aggregate amount of cash to be paid to minority stockholders equals approximately the cash cap (subject to the rounding mechanics of the proration provisions of the merger agreement), as adjusted in accordance with the terms of the merger agreement.

As a result of this proration feature, in most cases, the form of merger consideration actually received by a minority stockholder will differ in part from the form of consideration that the minority stockholder elects to receive.

Dissenters’ Shares

If the payment by Coast Casinos or the new Coast Casinos, Inc. to dissenting stockholders of Coast Casinos, as further described above under “The Merger—Dissenters’ Rights of Coast Casinos Stockholders,” has the effect of reducing the fair market value of the assets of Coast Casinos acquired in the merger below 90% of the fair market value of the net assets, or 70% of the fair market value of the gross assets, of Coast Casinos immediately prior to the effective time of the merger, taking into account any other payments or distributions made by Coast Casinos in connection with the merger, Boyd Gaming, in lieu of Coast Casinos or the new Coast Casinos, Inc., as the case may be, will pay to the dissenting stockholders that portion of the payment equal to the excess of:

•

the total amount to be paid to the dissenting stockholders by Coast Casinos or the new Coast Casinos, Inc., as the case may be, over

•

the maximum amount payable to dissenting stockholders by Coast Casinos or the new Coast Casinos, Inc., as the case may be, so that the payment would not reduce the fair market value of the assets of Coast Casinos acquired by Boyd Gaming below 90% of the fair market value of the net assets, or 70% of the fair market value of the gross assets, of Coast Casinos immediately prior to the effective time of the merger, taking into account any other payments or distributions made by Coast Casinos in connection with the merger.

If, after this payment is made to the dissenting stockholders, the aggregate value of all shares of Boyd Gaming common stock issued in the merger, with the value of each share of Boyd Gaming common stock being the average of the high and low sale price of a share of Boyd Gaming common stock on the New York Stock Exchange on the Date of Determination, does not equal at least 40% of the aggregate value of all merger consideration, then Boyd Gaming will issue sufficient additional shares of Boyd Gaming common stock on a pro rata basis to all minority stockholders, other than dissenting stockholders, so that the aggregate value of all shares of Boyd Gaming common stock:

•

issued to Coast Casinos stockholders, other than dissenting stockholders, in the merger, with the value of each share of Boyd Gaming common stock being the average of the high and low sale price of a share of Boyd Gaming common stock on the New York Stock Exchange on the Date of Determination, and

•

issued to Coast Casinos stockholders on a pro rata basis in the merger pursuant to this paragraph, with the value of each share of Boyd Gaming common stock being the lower of the average of the high and low sale price of a share of Boyd Gaming common stock on the New York Stock Exchange on the Date of Determination or the date of issuance of that share of Boyd Gaming common stock,

equals 40% of the aggregate value of all merger consideration.

Cancellation of Shares

Each share of Coast Casinos common stock that is owned by Coast Casinos as treasury stock or by Boyd Gaming or BGC, Inc. immediately prior to the effective time of the merger will be automatically canceled, and no consideration will be delivered in exchange for any of those shares.

Procedures for Exchange of Certificates; Fractional Shares

Boyd Gaming has retained Wells Fargo Shareowner Services as the exchange agent for the merger to handle the exchange of shares of Coast Casinos common stock for the merger consideration, including the payment of cash for fractional shares. To effect the exchange of shares of Coast Casinos common stock, the exchange agent will take the following actions:

Coast Casinos Common Stock–General

As soon as reasonably practicable after the effective time of the merger, the exchange agent will mail to each record holder of shares of Coast Casinos common stock, other than holders who are entitled to and make an

election as described below under “—Coast Casinos Common Stock—Election,” a letter of transmittal and instructions for surrendering the certificates representing shares of Coast Casinos common stock for merger consideration. Upon surrender of certificates representing shares of Coast Casinos common stock for cancelation, together with an executed letter of transmittal, to the exchange agent, the holder of those certificates will be entitled to receive the appropriate merger consideration.

Coast Casinos Common Stock–Election

At the time of mailing of this joint proxy statement/prospectus to the record holders of shares of Coast Casinos common stock entitled to vote at the Coast Casinos Meeting, Boyd Gaming will mail an election form to each record holder of shares of Coast Casinos common stock entitled to an election, as described above under “—Consideration to be Received in the Merger—General.” To be effective, the election form must be properly completed, signed and received by, and stock certificates evidencing the shares of Coast Casinos common stock with respect to which an election is being made must be submitted to, the exchange agent no later than 5:00 p.m., Pacific time, on the business day immediately preceding the date of the Coast Casinos Meeting. At the effective time of the merger, Coast Casinos stockholders who surrender their stock certificates with the election form will be entitled to receive the consideration described above under “—Consideration to be Received in the Merger—General” into which the shares of Coast Casinos common stock represented by those stock certificates will be converted, subject to adjustment and proration as described above under “—Consideration to be Received in the Merger—Adjustments to the Merger Consideration and Proration.” If no form of election is received with respect to shares of Coast Casinos common stock, or if the exchange agent determines that any election to receive stock consideration was not properly made with respect to shares of Coast Casinos common stock, including the failure to submit the stock certificates evidencing the shares of Coast Casinos common stock subject to the election, those shares of Coast Casinos common stock will be treated by the exchange agent as the stockholder not having made an election at the effective time of the merger, and those shares of Coast Casinos common stock will be converted into the right to receive cash consideration, except as otherwise described above under “—Consideration to be Received in the Merger—Adjustments to the Merger Consideration and Proration.”

Forms of election may be revoked only by written notice received by the exchange agent prior to 5:00 p.m., Pacific time, on the business day immediately preceding the date of the Coast Casinos Meeting. If a form of election is revoked, all certificates surrendered to the exchange agent with the revoked form of election will be returned to the Coast Casinos stockholder who submitted the revoked form of election.

Fractional Shares

Boyd Gaming will not issue fractional shares of Boyd Gaming common stock in the merger. Instead, each holder of shares of Coast Casinos common stock who would otherwise be entitled to receive fractional shares of Boyd Gaming common stock in the merger will be entitled to an amount of cash, without interest, rounded to the nearest cent, equal to the product of the amount of the fractional share interest in a share of Boyd Gaming common stock to which that stockholder is entitled by an amount equal to the average of the closing sale prices for a share of Boyd Gaming common stock on the New York Stock Exchange, as reported in The Wall Street Journal, Northeastern edition, for each of the ten consecutive trading days ending with the second complete trading day prior to the effective time of the merger.

Notwithstanding the foregoing, in the event that an adjustment to the target stock amount and the cash cap is made, as described under “—Consideration to be Received in the Merger—Adjustments to the Merger Consideration and Proration,” each Coast Casinos stockholder who would otherwise be entitled to a fractional share of Boyd Gaming common stock will not receive cash in lieu of the fractional share, but will instead receive one whole share of Boyd Gaming common stock in lieu of the fractional share.

Dividends and Distributions

Boyd Gaming will not pay any dividends or other distributions in respect of Boyd Gaming common stock issuable in exchange for shares of Coast Casinos common stock in the merger until the holder is entitled to

receive, in exchange for certificates representing shares of Coast Casinos common stock, the merger consideration represented by those certificates. After the holder of certificates representing shares of Coast Casinos common stock becomes entitled to receive the merger consideration, the holder of the new certificates representing whole shares of Boyd Gaming common stock issued in exchange for the certificates representing shares of Coast Casinos common stock will be paid, at the time of exchange, without interest, the amount of any cash payable in lieu of a fractional share of Boyd Gaming common stock to which the holder is entitled, the amount of dividends or other distributions with a record date after the effective time of the merger theretofore paid with respect to such whole shares of Boyd Gaming common stock and, at the appropriate payment date, the amount of dividends or other distributions with a record date after the effective time of the merger but prior to the time of the exchange and a payment date subsequent to the time of the exchange payable with respect to those whole shares of Boyd Gaming common stock.

After the six-month anniversary of the effective time of the merger, any holder of certificates representing shares of Coast Casinos common stock will look to Boyd Gaming or the new Coast Casinos, Inc. for payment of such holder’s claim for the merger consideration.

Representations and Warranties

The merger agreement contains a number of customary representations and warranties made by Boyd Gaming, BGC, Inc. and Coast Casinos with respect to themselves and their respective subsidiaries. These generally reciprocal representations and warranties relate to:

•

corporate existence, organization and authority to carry on its business;

•

subsidiaries;

•

capital structure;

•

power and authority to enter into the merger agreement and to consummate the transactions contemplated by the merger agreement;

•

absence of any breach of organizational documents, law or material agreements as a result of the merger;

•

SEC documents and undisclosed liabilities;

•

information supplied for inclusion in this joint proxy statement/prospectus;

•

absence of specific changes or events;

•

litigation;

•

compliance with laws; and

•

brokers fees and expenses.

In addition, Coast Casinos makes representations and warranties to Boyd Gaming and BGC, Inc. regarding:

•

taxes;

•

absence of changes in benefit plans;

•

ERISA compliance and excess parachute payments;

•

assets other than real property;

•

real property;

•

labor matters;

•

contracts;

•

environmental matters;

•

intellectual property; and

•

the opinion of Coast Casinos’ financial advisor.

None of the representations and warranties in the merger agreement will survive the effective time of the merger.

Material Adverse Effect

Many of the representations and warranties made by Boyd Gaming, BGC, Inc. and Coast Casinos are qualified by a material adverse effect threshold. For purposes of the merger agreement, a material adverse effect means a material adverse effect on the business, assets, financial condition or results of operations of Boyd Gaming and its subsidiaries or Coast Casinos and its subsidiaries, in each case taken as a whole, on the ability of Boyd Gaming, BGC, Inc. or Coast Casinos, as applicable, to perform its obligations under the merger agreement or on the ability of Boyd Gaming, BGC, Inc. or Coast Casinos to consummate the merger and the other transactions contemplated under the merger agreement to be performed or consummated by such entity, other than any state of facts, event, change, effect, development, condition or occurrence relating:

•

to the economy in general;

•

to Boyd Gaming’s or Coast Casinos’, as applicable, industry in general and not specifically relating to Boyd Gaming and its subsidiaries or Coast Casinos and its subsidiaries, as applicable; and

•

primarily to the entering into by Coast Casinos of the merger agreement with Boyd Gaming as opposed to any other third party.

Covenants

The merger agreement provides for covenants relating to the conduct of business of Coast Casinos. Between the date of the merger agreement and the effective time of the merger, Coast Casinos and its subsidiaries will conduct their respective businesses in the usual, regular and ordinary course in substantially the same manner as previously conducted and will use all reasonable efforts to preserve intact their respective business organizations, keep available the services of their respective current officers and employees and keep their respective relationships with customers, suppliers, licensors, licensees, distributors and other business associates to the end that their respective goodwill and ongoing businesses will be unimpaired at the effective time of the merger. In addition, between the date of the merger agreement and the effective time of the merger, neither Coast Casinos nor any of its subsidiaries will, without the prior written consent of Boyd Gaming:

•

declare, set aside or pay any dividends on, or make any other distributions in respect of, any of its capital stock, other than the $3.50 per share dividend declared prior to the date of the merger agreement or dividends and distributions by direct or indirect wholly owned subsidiaries of Coast Casinos to that subsidiary’s direct parent;

•

split, combine or reclassify any of its capital stock or issue or authorize the issuance of any other securities in respect of, in lieu of or in substitution for shares of its capital stock;

•

purchase, redeem or otherwise acquire any shares of capital stock of Coast Casinos or any of its subsidiaries, any other securities of Coast Casinos or any of its subsidiaries or any rights, warrants or options to acquire any such shares or other securities or any options, warrants, rights, securities, units, commitments, contracts, arrangements or undertakings of any kind that give any person the right to receive any economic benefits and rights accruing to holders of capital stock of Coast Casinos or any of its subsidiaries;

•

issue, deliver, sell or grant any shares of its capital stock, any voting securities, any securities convertible into or exchangeable for, or any options, warrants or rights to acquire, any shares of its

capital stock, voting securities or convertible or exchangeable securities, any “phantom” stock, “phantom” stock rights, stock appreciation rights or stock-based performance units, or any options, warrants, rights, securities, units, commitments, contracts, arrangements or undertakings of any kind that give any person the right to receive any economic benefits and rights accruing to holders of capital stock of Coast Casinos or any of its subsidiaries, other than the issuance of Coast Casinos common stock upon the exercise of employee stock options outstanding on, and in accordance with the terms thereof as of, the date of the merger agreement;

•

amend its articles of incorporation, by-laws or other comparable charter or organizational documents;

•

acquire or agree to acquire, by merging or consolidating with, or by purchasing a substantial portion of the assets of, or by any other manner, any equity interest in a business or any corporation, partnership, joint venture, association or other business organization or division thereof, or acquire or agree to acquire any assets that are material, individually or in the aggregate, to Coast Casinos and its subsidiaries, taken as a whole, except purchases of inventory in the ordinary course of business consistent with past practice;

•

grant to any current or former employee, officer, director or independent contractor of Coast Casinos or any of its subsidiaries any loan or increase in compensation, benefits, perquisites or any bonus or award, or pay any bonus to any such person, except to the extent required under employment agreements in effect as of the date of the merger agreement;

•

grant to any current or former employee, officer, director or independent contractor of Coast Casinos or any of its subsidiaries any increase in severance, change in control or termination pay or benefits, except to the extent required under any agreement in effect as of the date of the merger agreement;

•

enter into any employment, change in control, loan, retention, consulting, indemnification, severance, termination or similar agreement with any current or former employee, officer, director or independent contractor of Coast Casinos or any of its subsidiaries;

•

take any action to fund or in any other way secure the payment of compensation or benefits under any Coast Casinos benefit plan or benefit agreement;

•

establish, adopt, enter into, terminate or amend, or take any action to accelerate any rights or benefits, including vesting and payment, or make material determinations under, any collective bargaining agreement or any Coast Casinos benefit plan or benefit agreement;

•

make any change in accounting methods, principles or practices materially affecting the reported consolidated assets, liabilities or results of operations of Coast Casinos, except insofar as may have been required by a change in generally accepted accounting principles;

•

sell, lease (as lessor), license or otherwise dispose of or subject to any lien any properties or assets that have a fair value, individually, in excess of $250,000 or, in the aggregate, in excess of $2.5 million;

•

other than with respect to any credit facility or line of credit existing prior to the date of the merger agreement, incur any indebtedness for borrowed money or guarantee any such indebtedness of another person, issue or sell any debt securities or warrants or other rights to acquire any debt securities of Coast Casinos or any of its subsidiaries, guarantee any debt securities of another person, enter into any “keep well” or other agreement to maintain any financial statement condition of another person or enter into any arrangement having the economic effect of any of the foregoing, except for short-term borrowings incurred in the ordinary course of business consistent with past practice, or make any loans, advances or capital contributions to, or investments in, any other person, other than to or in Coast Casinos or any wholly owned subsidiary of Coast Casinos;

•

make or agree to make any new capital expenditure or expenditures that, in the aggregate, would exceed the aggregate amount budgeted in Coast Casinos’ 2004 budget;

•

make any material tax election or settle or compromise any material tax liability or refund;

•

pay, discharge or satisfy any claims, liabilities or obligations, other than the payment, discharge or satisfaction in respect of any credit facility or line of credit existing prior to the date of the merger agreement, or the payment, discharge or satisfaction, in the ordinary course of business consistent with past practice or in accordance with their terms, of liabilities reflected or reserved against in, or contemplated by, the most recent consolidated financial statements, or the notes thereto, of Coast Casinos included in the documents filed by Coast Casinos with the SEC or incurred in the ordinary course of business consistent with past practice, cancel any indebtedness in excess of $50,000 owed to Coast Casinos or waive any claims or rights of substantial value of Coast Casinos or waive the benefits of, or agree to modify in any manner, any confidentiality, standstill or similar agreement to which Coast Casinos or any of its subsidiaries is a party;

•

enter into any contract having a duration of more than one year and total payment obligations of Coast Casinos in excess of $1.0 million, other than the renewal, on substantially similar terms, of any contract existing on the date of the merger agreement and contracts entered into in respect of permitted capital expenditures; or

•

authorize or commit to any of the foregoing actions.

In addition, Boyd Gaming and Coast Casinos will not, and will not permit any of their respective subsidiaries to, take any action that would, or would reasonably be expected to, result in any of the representations and warranties made by such party in the merger agreement that is qualified as to materiality becoming untrue, any of the representations and warranties made by such party in the merger agreement that is not qualified as to materiality becoming untrue in any material respect or any condition to the effectiveness of the merger not being satisfied. Boyd Gaming and Coast Casinos will promptly advise each other of any state of facts, event, change, effect, development, condition or occurrence that, individually or in the aggregate, has had or would reasonably be expected to have a material adverse effect on such party.

No Solicitation

Coast Casinos has agreed not to, will not permit its subsidiaries to, and will not authorize or permit any officer, director, employee, investment banker, attorney or other advisor or representative of Coast Casinos or any of its subsidiaries to:

•

solicit, initiate or encourage the submission of any takeover proposal;

•

enter into any agreement with respect to any takeover proposal; or

•

Coast Casinos may, however, before the Coast Casinos stockholders approve the merger agreement, in response to an unsolicited bona fide takeover proposal which the Coast Casinos board of directors determines, in good faith, after consultation with outside counsel and financial advisors, may reasonably be expected to lead to a superior proposal, furnish information with respect to Coast Casinos to the person making the takeover proposal and its representatives pursuant to a customary confidentiality agreement, which agreement is not less restrictive of the person making the takeover proposal than the confidentiality agreement entered into by Coast Casinos with Boyd Gaming, and participate in discussions or negotiations with such person and its representatives regarding any takeover proposal.

A “takeover proposal” means:

•

any proposal or offer for a merger, consolidation, dissolution, recapitalization or other business combination involving Coast Casinos;

•

any proposal for the issuance by Coast Casinos of over 30% of its equity securities as consideration for the assets or securities of another person; or

•

any proposal or offer to acquire in any manner, directly or indirectly, over 30% of the equity securities or consolidated total assets of Coast Casinos,

in each case, other than the merger.

Neither the Coast Casinos board of directors nor any committee thereof may withdraw or modify in a manner adverse to Boyd Gaming or BGC, Inc., or publicly propose to withdraw or modify in a manner adverse to Boyd Gaming or BGC, Inc., the approval or recommendation of the Coast Casinos board of directors of the merger agreement or the merger, approve any letter of intent, agreement in principle, acquisition agreement or similar agreement relating to any takeover proposal or approve or recommend, or publicly propose to approve or recommend, any takeover proposal. Notwithstanding the foregoing, the Coast Casinos board of directors may withdraw or modify its approval or recommendation of the merger agreement or the merger if, prior to receipt of the approval of Coast Casinos stockholders:

•

Coast Casinos has received a superior proposal;

•

the Coast Casinos board of directors has determined in good faith, after consultation with outside counsel, that the withdrawal or modification of its approval or recommendation of the merger agreement or the merger is required for the purpose of fulfilling its fiduciary duties, and Coast Casinos has notified Boyd Gaming in writing of this determination;

•

at least three business days following receipt by Boyd Gaming of this notice, and taking into account any revised proposal made by Boyd Gaming since receipt of this notice, the Coast Casinos board of directors determines that the superior proposal remains a superior proposal; and

•

Coast Casinos is in compliance with all of its obligations under the no-solicitation provisions of the merger agreement.

Coast Casinos will promptly advise Boyd Gaming orally and in writing of any takeover proposal or inquiry with respect to or that could reasonably be expected to lead to a takeover proposal, the identity of the person making any takeover proposal or inquiry and the material terms of any takeover proposal or inquiry. Coast Casinos will keep Boyd Gaming informed of the status of any takeover proposal or inquiry and provide to Boyd Gaming, as soon as practicable after receipt or delivery thereof, copies of the takeover proposal and all other material information provided in writing to Boyd Gaming by the party making the takeover proposal.

Nothing in the merger agreement prohibits Coast Casinos from taking and disclosing to its stockholders a position contemplated by Rule 14e-2(a) promulgated under the Exchange Act or from making any other disclosure to Coast Casinos stockholders if, in the good faith judgment of the Coast Casinos board of directors, after consultation with outside counsel, failure to disclose would be inconsistent with the fulfillment of the fiduciary duties or any other obligations of the Coast Casinos board of directors under applicable law.

Coast Casinos Meeting

Coast Casinos has agreed to call and hold a meeting of its stockholders for the purpose of obtaining the approval of the merger agreement by a majority of the voting power of the holders of the outstanding shares of Coast Casinos common stock. Coast Casinos will, through its board of directors, recommend to its stockholders that the merger agreement be approved. Under certain circumstances in which it receives a superior proposal, however, the Coast Casinos board of directors may withdraw or modify its approval or recommendation of the merger agreement and the merger. In the event that the Coast Casinos board of directors withdraws or modifies its approval or recommendation of the merger agreement and the merger, the approval of the merger agreement and the merger will also require approval by a majority of the voting power of the holders of the outstanding shares of Coast Casinos common stock present and duly voted, in person or by proxy, at the Coast Casinos Meeting, exclusive of those votes taken in respect of the shares of Coast Casinos common stock held by Messrs. Gaughan, Herbst and Toti.

Boyd Gaming Meeting

Boyd Gaming has agreed to call and hold a meeting of its stockholders for the purpose of obtaining the approval of the issuance of shares of Boyd Gaming common stock in the merger by a majority of the Boyd Gaming stockholders present and voting at the Boyd Gaming Meeting. Boyd Gaming will, through its board of directors, recommend to its stockholders that the issuance of shares of Boyd Gaming common stock in the merger be approved.

Access to Information; Confidentiality

During the period prior to the effective time of the merger, Boyd Gaming and Coast Casinos will, and will cause each of their respective subsidiaries to, afford to the other party and its representatives reasonable access during normal business hours to all of their respective properties, books, contracts, commitments, personnel and records. During that period, each party will promptly provide to the other party a copy of each reporting document filed pursuant to the requirements of U.S. Federal or state securities laws, and all other information concerning its business, properties and personnel as the other party reasonably requests. The information will be held in confidence to the extent required by the provisions of the confidentiality agreement between Boyd Gaming and Coast Casinos.

Reasonable Efforts; Notification

Boyd Gaming and Coast Casinos will use all reasonable efforts to take, or cause to be taken, all actions, and to do, or cause to be done, and to assist and cooperate with other parties in doing, all things necessary, proper or advisable to consummate and make effective, in the most expeditious manner practicable, the merger and the other transactions contemplated by the merger agreement to be performed or consummated by such party in accordance with the terms of the merger agreement. This includes:

•

in the case of Boyd Gaming, obtaining all necessary approvals under any applicable gaming laws required in connection with the merger agreement, the merger and the other transactions contemplated by the merger agreement;

•

obtaining all necessary actions or nonactions, waivers, consents and approvals from governmental entities and making all necessary registrations and filings and taking all reasonable steps as may be necessary to obtain an approval or waiver from, or to avoid an action or proceeding by, any governmental entity;

•

obtaining all necessary consents, approvals or waivers from third parties;

•

defending any lawsuits or other legal proceedings, whether judicial or administrative, challenging the merger agreement or the consummation of the transactions contemplated by the merger agreement to be performed or consummated by Boyd Gaming or Coast Casinos, as applicable, in accordance with the terms of the merger agreement, including seeking to have any stay or temporary restraining order entered by any court or other governmental entity vacated or reversed; and

•

executing and delivering any additional instruments necessary to consummate the transactions contemplated by the merger agreement to be performed or consummated by Boyd Gaming or Coast Casinos, as applicable, in accordance with the terms of the merger agreement, and to fully carry out the purposes of the merger agreement.

In connection with and without limiting these obligations, Coast Casinos and its subsidiaries will take all reasonable action necessary to ensure that no state takeover statute or similar statute or regulation is or becomes applicable to the merger agreement or any transaction contemplated by the merger agreement. If any state takeover statute or similar statute or regulation becomes applicable to the merger agreement or any transaction contemplated by the merger agreement, Coast Casinos will take all reasonable action necessary to ensure that the merger and the other transactions contemplated by the merger agreement may be consummated as promptly as practicable on the terms contemplated by the merger agreement and otherwise to minimize the effect of the statute or regulation on the merger and the other transactions contemplated by the merger agreement.

Coast Casinos will give prompt notice to Boyd Gaming, and Boyd Gaming will give prompt notice to Coast Casinos, of any representation or warranty made by it or contained in the merger agreement that is qualified as to materiality becoming untrue or inaccurate in any respect, or any representation or warranty made by it or contained in the merger agreement that is not qualified as to materiality becoming untrue or inaccurate in any material respect. Coast Casinos and Boyd Gaming will also give prompt notice to the other of the failure by it to comply with or satisfy in any material respect any covenant, condition or agreement to be complied with or satisfied by it under the merger agreement. No notification, however, will affect the representations, warranties, covenants or agreements of the parties or the conditions to the obligations of the parties under the merger agreement.

Boyd Gaming will not be required to dispose of any of its assets or limit its freedom of action with respect to any of its businesses, or to consent to any disposition of Coast Casinos’ assets or limits on Coast Casinos’ freedom of action with respect to any of its businesses, or to commit or agree to any of the foregoing, and Coast Casinos will not be permitted to commit or agree to any of the foregoing, to obtain any consents, approvals, permits or authorizations or to remove any impediments to the merger relating solely to the HSR Act or other antitrust, competition or premerger notification, trade regulation law, regulation or order, or to avoid the entry of, or to effect the dissolution of, any injunction, temporary restraining order or other order in any suit or proceeding relating solely to the HSR Act or other antitrust, competition or premerger notification, trade regulation law, regulation or order.

Coast Casinos Stock Options and Benefit Plans

Coast Casinos Stock Options

Unless otherwise agreed in writing between Boyd Gaming and holders of Coast Casinos employee stock options, Boyd Gaming will not assume any Coast Casinos employee stock options that are not intended to qualify as “incentive stock options” within the meaning of Section 422 of the Internal Revenue Code in connection with the transactions contemplated by the merger agreement. Accordingly, as soon as reasonably practicable following the date of the merger agreement, the Coast Casinos board of directors or, if appropriate, any committee administering the Coast Casinos 1996 Stock Incentive Plan, will adopt the resolutions and take any other actions as may be required to:

•

provide that each Coast Casinos employee stock option that is not an incentive stock option that is outstanding immediately prior to the effective time of the merger will be canceled immediately prior to the effective time of the merger, whether vested or unvested, with the holder of the employee stock option becoming entitled to receive an amount of cash equal to the excess, if any, of $550 over the per share exercise price of the employee stock option, multiplied by the number of shares of Coast Casinos common stock subject to the employee stock option, subject to any applicable withholding of taxes;

•

adjust the terms of all outstanding Coast Casinos incentive stock options to provide that, at the effective time of the merger, each Coast Casinos incentive stock option outstanding immediately prior to the

effective time of the merger will be deemed to constitute an option to acquire, on the same terms and conditions as were applicable under the Coast Casinos incentive stock option, 32.8025 shares of Boyd Gaming common stock at a price per share equal to $3.04855, which options are referred to as “adjusted options,” although the foregoing will be adjusted to the minimum extent necessary to comply with Section 424(a) of the Internal Revenue Code; and

•

make other changes to the Coast Casinos 1996 Stock Incentive Plan as Boyd Gaming and Coast Casinos will mutually agree.

At the effective time of the merger, Boyd Gaming will assume all the obligations of Coast Casinos under the Coast Casinos 1996 Stock Incentive Plan, each outstanding adjusted option and the agreements evidencing the grants of the adjusted options. As soon as practicable after the effective time of the merger, Boyd Gaming will deliver to holders of adjusted options appropriate notices setting forth the holders’ rights pursuant to the Coast Casinos stock plan and indicating that the agreements evidencing the grants of adjusted options will continue in effect on the same terms and conditions, subject to adjustments required by the merger agreement after giving effect to the merger. Boyd Gaming will comply with the terms of the Coast Casinos stock plan and ensure, to the extent required by, and subject to the provisions of, the Coast Casinos 1996 Stock Incentive Plan, that the adjusted options continue to qualify as incentive stock options after the effective time of the merger.

Boyd Gaming will take all corporate action necessary to reserve for issuance a sufficient number of shares of Boyd Gaming common stock for delivery upon exercise of the adjusted options. As soon as reasonably practicable after the effective time of the merger, Boyd Gaming will file with the SEC a registration statement with respect to the shares of Boyd Gaming common stock subject to adjusted options and will use all reasonable efforts to maintain effectiveness of the registration statement, and maintain the current status of the prospectus contained therein, for so long as adjusted options remain outstanding.

Prior to the effective time of the merger, Boyd Gaming will take all such steps as may be required to cause any acquisition of shares of Boyd Gaming common stock, including adjusted options, in connection with the merger by any holder of shares of Coast Casinos common stock who is subject to the reporting requirements of Section 16(a) of the Exchange Act with respect to Boyd Gaming to be exempt under Rule 16b-3 promulgated under the Exchange Act.

Benefit Plans

Boyd Gaming will cause the new Coast Casinos, Inc. to maintain for a period of one year after the effective time of the merger the Coast Casinos benefit plans as in effect on the date of the merger agreement, other than the Coast Casinos 1996 Stock Incentive Plan or any other Coast Casinos benefit plan that provides benefits based on the value of Coast Casinos common stock, or to provide benefits, excluding benefits attributable to equity-based plans or grants, to each current employee of Coast Casinos and its subsidiaries that are at least as favorable in the aggregate to those employees as the benefits in effect on the date of the merger agreement.

From and after the effective time of the merger, Boyd Gaming will, and will cause the new Coast Casinos, Inc. to, honor in accordance with their respective terms all of Coast Casinos’ employment, severance and termination agreements, plans and policies.

With respect to any employee benefit plan, program or arrangement maintained by Boyd Gaming or any of its subsidiaries, including any severance plan, for all purposes of determining eligibility to participate and vesting but not for purposes of benefit accrual, service with Coast Casinos or any of its subsidiaries will be treated as service with Boyd Gaming or any of its subsidiaries. However, any service with Coast Casinos or any of its subsidiaries need not be recognized to the extent that recognition would result in any duplication of benefits.

Boyd Gaming will waive, or cause to be waived, any pre-existing condition limitation under any welfare benefit plan maintained by Boyd Gaming or any of its affiliates, other than Coast Casinos, in which employees of

Coast Casinos and its subsidiaries, as well as their eligible dependents, will be eligible to participate from and after the effective time of the merger, except to the extent that such pre-existing condition limitation would have been applicable under the comparable Coast Casinos welfare benefit plan immediately prior to the effective time of the merger. Boyd Gaming will recognize, or cause to be recognized, the dollar amount of all expenses incurred by each Coast Casinos employee, and his or her eligible dependents, during the calendar year in which the effective time of the merger occurs for purposes of satisfying such year’s deductible and co-payment limitations under the relevant welfare benefit plans in which they will be eligible to participate from and after the effective time of the merger.

Indemnification

Boyd Gaming will, to the fullest extent permitted by law, cause the new Coast Casinos, Inc. to honor all of Coast Casinos’ obligations to indemnify, including any obligations to advance funds for expenses to, the current or former directors or officers of Coast Casinos for acts or omissions by such directors and officers occurring prior to the effective time of the merger to the extent that those obligations of Coast Casinos exist on the date of the merger agreement.

For a period of six years after the effective time of the merger, Boyd Gaming will cause to be maintained in effect the current policies of directors’ and officers’ liability insurance maintained by Coast Casinos with respect to claims arising from or related to facts or events which occurred at or before the effective time of the merger, although Boyd Gaming may substitute policies with reputable and financially sound carriers of at least the same coverage and amounts containing terms and conditions which are no less advantageous. Boyd Gaming will not be obligated to make annual premium payments for such insurance to the extent such premiums exceed 175% of the annual premiums paid as of the date of the merger agreement by Coast Casinos for the insurance. If the insurance coverage cannot be obtained at all, or can only be obtained at an annual premium in excess of the maximum premium, Boyd Gaming will maintain the most advantageous policies of directors’ and officers’ insurance obtainable for an annual premium equal to the maximum premium. Coast Casinos represents to Boyd Gaming that the maximum premium is $270,156.25.

Fees and Expenses

Except as provided under “—Fee if the Merger Agreement is Terminated,” all fees and expenses incurred in connection with the merger will be paid by the party incurring such fees or expenses, whether or not the merger is consummated. An exception to this general requirement is that expenses incurred in connection with filing, printing and mailing this joint proxy statement/prospectus will be shared equally by Boyd Gaming and Coast Casinos.

Public Announcements

Boyd Gaming and BGC, Inc., on the one hand, and Coast Casinos, on the other hand, will consult with each other before issuing, and provide each other reasonable opportunity to review and comment upon, any press release or other public statements with respect to the merger and the other transactions contemplated by the merger agreement and will not issue any such press release or make any public statement prior to consultation with the other, except as may be required by applicable law, court process or by obligations pursuant to any listing agreement with any national securities exchange.

Transfer Taxes

All stock transfer, real estate transfer, documentary, stamp, recording and other similar taxes, including interest, penalties and additions to those taxes, incurred in connection with the transactions contemplated by the merger agreement will be paid by either BGC, Inc. or the new Coast Casinos, Inc., and Coast Casinos will cooperate with BGC, Inc. and Boyd Gaming in preparing, executing and filing any tax returns with respect to those taxes.

Stock Exchange Listing

Boyd Gaming will use all reasonable efforts to cause the shares of Boyd Gaming common stock to be issued in the merger to be approved for listing on the New York Stock Exchange, subject to official notice of issuance, prior to the closing date of the merger.

Tax Treatment

Boyd Gaming and Coast Casinos intend the merger to qualify as a reorganization within the meaning of Section 368(a) of the Internal Revenue Code. Each party and its affiliates will use all reasonable efforts to cause the merger to qualify as a reorganization within the meaning of Section 368(a) of the Internal Revenue Code and to obtain opinions from legal counsel to the effect that the merger will be treated for U.S. Federal income tax purposes as a reorganization within the meaning of Section 368(a) of the Internal Revenue Code and that Boyd Gaming, BGC, Inc. and Coast Casinos will each be a party to that reorganization within the meaning of Section 368(b) of the Internal Revenue Code. Each of Boyd Gaming, BGC, Inc. and Coast Casinos, and each of their respective affiliates, will not take any action and will not fail to take any action or suffer to exist any condition which action or failure to act or condition would prevent, or would reasonably be likely to prevent, the merger from qualifying as a reorganization within the meaning of Section 368(a) of the Internal Revenue Code.

Although Boyd Gaming and Coast Casinos intend for the merger to qualify as a tax-free transaction for U.S. Federal income tax purposes, if any of the consideration received by a Coast Casinos stockholder in the merger consists of cash, then the merger may result in that Coast Casinos stockholder being required to pay tax. For a full description of the tax consequences of the merger for Coast Casinos stockholders, see “The Merger—U.S. Federal Income Tax Consequences of the Merger.”

Stockholder Litigation

Coast Casinos will give Boyd Gaming the opportunity to participate in the defense or settlement of any stockholder litigation against Coast Casinos and its directors relating to the merger or any other transaction contemplated by the merger agreement. No settlement agreement with respect to any stockholder litigation against Coast Casinos and its directors relating to the merger or any other transaction contemplated by the merger agreement may be agreed to without Boyd Gaming’s consent.

Boyd Gaming Board of Directors

Boyd Gaming will take all actions reasonably necessary to:

•

cause Peter M. Thomas to be elected to the Boyd Gaming board of directors on or prior to the closing date of the merger; and

•

as soon as reasonably practicable after the closing date of the merger and following the receipt of any necessary regulatory approvals, expand the Boyd Gaming board of directors to create two vacant positions and appoint, as directors to fill those vacant positions, each of Mr. Gaughan and a designee of Mr. Gaughan satisfactory to Boyd Gaming.

If Mr. Thomas is not elected to the Boyd Gaming board of directors on or prior to the closing date of the merger, Boyd Gaming will take all actions reasonably necessary as soon as reasonably practicable after the closing date of the merger and following the receipt of any necessary regulatory approvals to:

•

expand the Boyd Gaming board of directors to create one additional vacant position; and

•

appoint, as a director to fill this vacant position, a second designee of Mr. Gaughan satisfactory to Boyd Gaming.

Conditions to the Merger

The obligation of each party to effect the merger is subject to the satisfaction or waiver on or before the closing date of the merger of the following conditions:

•

approval of the merger agreement by the Coast Casinos stockholders and approval of the issuance of shares of Boyd Gaming common stock in the merger by the Boyd Gaming stockholders;

•

the shares of Boyd Gaming common stock issuable to Coast Casinos stockholders pursuant to the merger agreement will have been approved for listing on the New York Stock Exchange, subject to official notice of issuance;

•

all consents, approvals, orders or authorizations from, and all declarations, filings and registrations with, any governmental entity, including all necessary approvals under any applicable gaming laws, required to consummate the merger and the other transactions contemplated by the merger agreement will have been obtained or made without the imposition of any material conditions. For the status of the filings under gaming laws, see “The Merger—Governmental and Regulatory Matters—Gaming Regulation”;

•

the waiting period, and any extension thereof, applicable to the merger under the HSR Act will have expired or been terminated. See “The Merger—Governmental and Regulatory Matters—United States Antitrust”;

•

no temporary restraining order, preliminary or permanent injunction or other order issued by any court of competent jurisdiction or other legal restraint or prohibition preventing the consummation of the merger will be in effect, provided that prior to asserting this condition, each of the parties will have used its reasonable efforts to prevent entry of any injunction or other order and to appeal as promptly as possible any injunction or other order that may be entered;

•

the Form S-4, of which this joint proxy statement/prospectus is a part, will have become effective under the Securities Act and will not be the subject of any stop order or proceedings seeking a stop order, and Boyd Gaming will have received all state securities or “blue sky” authorizations necessary to issue Boyd Gaming common stock pursuant to the merger; and

•

there will not be pending or threatened any suit, action or proceeding by any governmental entity or any other person, in each case that has a reasonable likelihood of success:

—

challenging the acquisition by Boyd Gaming and BGC, Inc. of Coast Casinos common stock, seeking to restrain or prohibit the consummation of the merger or any other transaction contemplated by the merger agreement or seeking to obtain from Coast Casinos, Boyd Gaming or BGC, Inc. any damages that are material in relation to Coast Casinos and its subsidiaries taken as a whole;

—

seeking to prohibit or limit the ownership or operation by Coast Casinos, Boyd Gaming or any of their respective subsidiaries of any material portion of the business or assets of Coast Casinos, Boyd Gaming or any of their respective subsidiaries, or to compel Coast Casinos, Boyd Gaming or any of their respective subsidiaries to dispose of or hold separate any material portion of the business or assets of Coast Casinos, Boyd Gaming or any of their respective subsidiaries, as a result of the merger or any other transaction contemplated by the merger agreement;

—

seeking to impose limitations on the ability of Boyd Gaming to acquire or hold, or exercise full rights of ownership of, any shares of Coast Casinos common stock, including the right to vote the Coast Casinos common stock purchased by it on all matters properly presented to the stockholders of Coast Casinos;

—

seeking to prohibit Boyd Gaming or any of its subsidiaries from effectively controlling in any material respect the business or operations of Coast Casinos and its subsidiaries; or

—

which otherwise is reasonably likely to have a material adverse on either Coast Casinos or Boyd Gaming.

The obligations of Boyd Gaming and BGC, Inc. to effect the merger is also subject to the satisfaction, or waiver by Boyd Gaming, on or before the closing date of the following conditions:

•

the representations and warranties of Coast Casinos in the merger agreement that are qualified as to materiality will be true and correct, and the representations and warranties of Coast Casinos in the merger agreement that are not qualified as to materiality will be true and correct in all material respects, as of the date of the merger agreement and as of the closing date as though made on the closing date, except to the extent that the representations and warranties expressly relate to an earlier date, in which case those representations and warranties that are qualified as to materiality will be true and correct, and those representations and warranties that are not qualified as to materiality will be true and correct in all material respects, on and as of such earlier date, and, in each case, Boyd Gaming will have received a certificate signed on behalf of Coast Casinos by an executive officer of Coast Casinos to that effect;

•

Coast Casinos will have performed in all material respects all obligations under the merger agreement at or prior to the closing date, and Boyd Gaming will have received a certificate signed on behalf of Coast Casinos by an executive officer of Coast Casinos to that effect;

•

except as previously disclosed, since the date of the merger agreement, there will not have been any state of facts, event, change, effect, development, condition or occurrence that, individually or in the aggregate, has had or would reasonably be expected to have a material adverse effect on Coast Casinos;

•

Boyd Gaming will have received letters from specified affiliates of Coast Casinos; and

•

Boyd Gaming will have received a written opinion, dated as of the closing date, from its outside legal counsel to the effect that the merger will be treated for U.S. Federal income tax purposes as a reorganization within the meaning of Section 368(a) of the Internal Revenue Code, and that Boyd Gaming, BGC, Inc. and Coast Casinos will each be a party to that reorganization within the meaning of Section 368(b) of the Internal Revenue Code.

The obligations of Coast Casinos to effect the merger is also subject to the satisfaction, or waiver by Coast Casinos, on or before the closing date of the following conditions:

•

the representations and warranties of Boyd Gaming and BGC, Inc. in the merger agreement that are qualified as to materiality will be true and correct, and the representations and warranties of Boyd Gaming and BGC, Inc. in the merger agreement that are not qualified as to materiality will be true and correct in all material respects, as of the date of the merger agreement and as of the closing date as though made on the closing date, except to the extent that the representations and warranties expressly relate to an earlier date, in which case those representations and warranties that are qualified as to materiality will be true and correct, and those representations and warranties that are not qualified as to materiality will be true and correct in all material respects, on and as of such earlier date, and, in each case, Coast Casinos will have received a certificate signed on behalf of Boyd Gaming by an executive officer of Boyd Gaming to that effect;

•

Boyd Gaming and BGC, Inc. will have performed in all material respects all of their respective obligations under the merger agreement at or prior to the closing date, and Coast Casinos will have received a certificate signed on behalf of Boyd Gaming by an executive officer of Boyd Gaming to that effect;

•

Coast Casinos will have received a written opinion, dated as of the closing date, from its outside legal counsel to the effect that the merger will be treated for U.S. Federal income tax purposes as a reorganization within the meaning of Section 368(a) of the Internal Revenue Code, and that Boyd Gaming, BGC, Inc. and Coast Casinos will each be a party to that reorganization within the meaning of Section 368(b) of the Internal Revenue Code.

None of Coast Casinos, Boyd Gaming or BGC, Inc. may rely on the failure of any of the foregoing conditions to be satisfied if the failure was caused by such party’s failure to use all reasonable efforts to consummate the merger and the other transactions contemplated by the merger agreement to be performed or consummated by such party in accordance with the terms of the merger agreement, as required by and subject to the terms of the merger agreement.

Termination

•

the merger is not consummated on or before January 31, 2005, unless the failure to consummate the merger is the result of a willful and material breach of the merger agreement by the party seeking to terminate the merger agreement. However, if, as of January 31, 2005, any hearing with respect to any necessary approval under applicable gaming laws has been scheduled for a date after January 31, 2005 or any such hearing is pending, then the January 31, 2005 deadline will be extended to April 30, 2005;

•

any governmental entity issues an order, decree or ruling or takes any other action, which action has become final and nonappealable, permanently enjoining, restraining or otherwise prohibiting the merger;

•

the Coast Casinos stockholders fail to approve the merger agreement at the Coast Casinos Meeting, it being understood that, in the event that, prior to the date of the Coast Casinos Meeting, Coast Casinos withdraws or modifies its approval or recommendation of the merger and the merger agreement in accordance with the terms described under “—No Solicitation,” the approval of the merger and the merger agreement will require both:

—

the approval by a majority of the voting power of the holders of the outstanding shares of Coast Casinos capital stock, and

—

the approval by a majority of the voting power of the holders of the outstanding shares of Coast Casinos common stock present and duly voted, in person or by proxy, at the Coast Casinos Meeting, exclusive of those votes taken in respect of the shares of Coast Casinos common stock held by Messrs. Gaughan, Herbst and Toti; or

•

the Boyd Gaming stockholders fail to approve the issuance of shares of Boyd Gaming common stock in the merger at the Boyd Gaming Meeting.

Boyd Gaming can terminate the merger agreement before the effective time of the merger if:

•

Coast Casinos breaches or fails to perform in any material respect any of its representations, warranties or covenants in the merger agreement, which breach or failure to perform would give rise to a failure of a condition set forth in the merger agreement and which breach or failure to perform cannot be or has not been cured within 30 days after the giving of written notice to Coast Casinos of such breach; and

•

the aggregate number of shares of Boyd Gaming common stock required to be issued by Boyd Gaming in accordance with the terms described under “—Consideration to be Received in the Merger” would exceed 7,837,077 shares of Boyd Gaming common stock.

Coast Casinos can terminate the merger agreement before the effective time of the merger if Boyd Gaming breaches or fails to perform in any material respect any of its representations, warranties or covenants in the merger agreement, which breach or failure to perform would give rise to a failure of a condition set forth in the merger agreement and which breach or failure to perform cannot be or has not been cured within 30 days after the giving of written notice to Boyd Gaming of such breach.

Fee if the Merger Agreement is Terminated

A termination fee of $30.0 million is payable by Coast Casinos to Boyd Gaming if:

•

after the date of the merger agreement, any person makes a takeover proposal for Coast Casinos or amends a takeover proposal for Coast Casinos made prior to the date of the merger agreement; and

•

the merger agreement is terminated by either Coast Casinos or Boyd Gaming because the merger has not been consummated prior to January 31, 2005 or, if extended, April 30, 2005, or because the Coast Casinos stockholders fail to approve the merger agreement at the Coast Casinos Meeting, in each case as more fully described above under “—Termination,” or the merger agreement is terminated by Boyd Gaming because Coast Casinos breaches or fails to perform in any material respect any of its representations, warranties or covenants in the merger agreement, which breach or failure to perform would give rise to a failure of a condition set forth in the merger agreement and which breach or failure to perform cannot be or has not been cured within 30 days after the giving of written notice to Coast Casinos of such breach; and

•

within 30 months after the date of the merger agreement, Coast Casinos enters into a definitive agreement to consummate, or consummates, the transactions contemplated by a takeover proposal.

The termination fee will be payable and will be paid on the date of consummation of such takeover transaction. If Coast Casinos fails promptly to pay the termination fee, and, in order to obtain the payment, Boyd Gaming commences a suit that results in a judgment against Coast Casinos for the termination fee, Coast Casinos will pay to Boyd Gaming interest on the termination fee from and including the date payment of the termination fee was due to but excluding the date of actual payment at the prime rate of Bank of America, National Association in effect on the date the payment was required to be made, together with reasonable legal fees and expenses incurred in connection with the suit.

For purposes of determining whether a termination fee is payable, the term “takeover proposal” will have the meaning described above under “—No Solicitation,” except that all references to “30%” will be changed to “40%.”

Effect of Termination

In the event of termination of the merger agreement by either Boyd Gaming or Coast Casinos in accordance with the terms of the merger agreement, the merger agreement will immediately become void and have no effect, without any liability or obligation on the part of Boyd Gaming, BGC, Inc. or Coast Casinos, other than certain provisions relating to confidentiality, the payment of fees and expenses and certain other general provisions which will survive the termination except to the extent that such termination results from the wilful and material breach by a party of any representation, warranty or covenant set forth in the merger agreement.

Amendment

The merger agreement may be amended by the parties at any time prior to the effective time of the merger by an instrument in writing signed on behalf of each of the parties. However, after the approval of the merger agreement at the Coast Casinos Meeting and the approval of the issuance of shares of Boyd Gaming common stock in the merger at the Boyd Gaming Meeting, there will be no amendment made that by law or, in the case of the approval at the Boyd Gaming Meeting, by the regulations established by the New York Stock Exchange requires further approval by the stockholders of Coast Casinos or Boyd Gaming without the further approval of the stockholders of Coast Casinos or Boyd Gaming. Except as provided in the immediately preceding sentence, no amendment of the merger agreement will require the approval of the stockholders of Coast Casinos.

Extension; Waiver

At any time before the effective time of the merger, either party may extend the time for the performance of any of the obligations or other acts of the other parties, waive any inaccuracies in the representations and warranties of the other parties contained in the merger agreement or in any document delivered pursuant to the merger agreement or waive compliance by the other parties with any of the agreements or conditions contained in the merger agreement. Any agreement on the part of either party to any extension or waiver will be valid only if set forth in an instrument in writing signed on behalf of such party. The failure of any party to the merger agreement to assert any of its rights under the merger agreement or otherwise will not constitute a waiver of those rights.

UNAUDITED PRO FORMA CONDENSED COMBINED FINANCIAL STATEMENTS

The unaudited pro forma condensed combined financial data presented below is derived from the historical consolidated financial statements of Boyd Gaming and Coast Casinos, which are incorporated by reference in this joint proxy statement/prospectus, as well as the historical financial statements of the Shreveport Partnership which are not included in this joint proxy statement/prospectus and which have been derived from the Shreveport Partnership’s unaudited internal financial information and represent the best currently available information related to the Shreveport Partnership’s financial condition and statement of operations for the periods indicated. These financial statements have been adjusted to give effect to:

•

Boyd Gaming’s acquisition of the Shreveport Partnership, and

•

the merger of Coast Casinos with and into BGC, Inc., after giving pro forma effect to Boyd Gaming’s acquisition of the Shreveport Partnership.

The unaudited pro forma condensed combined financial statements contained in this joint proxy statement/prospectus use the purchase method of accounting, with Boyd Gaming treated as the acquirer and as if the acquisition of the Shreveport Partnership and the merger each had been completed on December 31, 2003 for purposes of the unaudited pro forma condensed combined balance sheet information, and on January 1, 2003 for purposes of the unaudited pro forma condensed combined statement of operations information.

The actual amounts that Boyd Gaming records on its final assessment of fair values may differ materially from the information presented in this unaudited pro forma condensed combined financial information. Amounts preliminarily allocated to intangible assets with indefinite lives and to tangible and intangible assets with definite lives may change significantly, and amortization methods and useful lives may differ from the assumptions Boyd Gaming used in this unaudited pro forma condensed combined financial information, any of which could result in a material change in depreciation and amortization expense.

The unaudited pro forma condensed combined financial information is for informational purposes only and is not intended to represent or be indicative of the consolidated results of operations or financial position that Boyd Gaming would have reported had the acquisition of the Shreveport Partnership and the merger been completed as of the dates presented, and should not be taken as representative of Boyd Gaming’s future consolidated results of operations or financial position.

The unaudited pro forma condensed combined financial statements of Boyd Gaming are prepared in accordance with Article 11 of Regulation S-X.

You should read the financial information in this section along with Boyd Gaming’s and Coast Casinos’ historical consolidated financial statements and accompanying notes incorporated by reference in this joint proxy statement/prospectus. See Chapter IV—Additional Information.

UNAUDITED PRO FORMA CONDENSED COMBINED BALANCE SHEET

AS OF DECEMBER 31, 2003

(dollars in thousands)


	Boyd Gaming Historical			Shreveport Partnership Historical		Pro Forma Adjustments			Boyd Gaming Pro Forma Combined			Coast Casinos Historical			Pro Forma Adjustments			Combined Company Pro Forma
ASSETS
Cash and cash equivalents	$	88,213		$	14,931	$	—		$	103,144		$	49,517		$	—		$	152,661
Restricted cash		18,128			—		—			18,128			—			—			18,128
Accounts receivable, net		14,800			2,190		(1,121	)(m)		15,869			6,574			—			22,443
Inventories		4,432			1,008		(1,008	)(m)		4,432			8,954			—			13,386
Prepaid expenses and other		17,502			363		(363	)(m)		17,502			20,960			—			38,462
Income taxes receivable		7,523			—		—			7,523			—			2,068	(k)		9,591
Deferred tax asset		9,033			—		—			9,033			—			—			9,033

Total current assets		159,631			18,492		(2,492	)		175,631			86,005			2,068			263,704

Property and equipment, net		958,816			159,853					1,118,669			743,283			30,000	(a)		1,891,952
Investment in Borgata, net		265,552			—		—			265,552			—			—			265,552
Other assets, net		39,488			15,173		(15,173	)(n)		39,488			10,647			18,125	(d)		53,487
																(9,470	)(j)
																(5,303	)(k)
Due from affiliates		—			170,242		(170,242	)(n)		—			—			—			—
Goodwill, net		862			—		—			862			—			546,656	(i)		575,108
																27,590	(l)
Intangible assets, net		448,648			—		30,147	(h)		478,795			—			20,000	(h)		498,795

Total assets	$	1,872,997		$	363,760	$	(157,760	)	$	2,078,997		$	839,935		$	629,666		$	3,548,598

LIABILITIES and EQUITY
Current maturities of long-term debt	$	1,463		$	—	$	—		$	1,463		$	1,376		$	(1,376	)(b)	$	1,463
Accounts payable		35,714			1,252		(1,252	)(o)		35,714			15,890			—			51,604
Construction payables		6,877			—		—			6,877			3,355			—			10,232
Accrued and other liabilities		156,247			9,210		(8,710	)(o)		156,747			49,091			—			205,838

Total current liabilities		200,301			10,462		(9,962	)		200,801			69,712			(1,376	)		269,137

Long-term debt, net		1,097,589			150,000		(150,000	)(b)		1,303,089			471,543			(471,543	)(b)		2,314,809
							205,500	(c)								15,438	(q)
																13,237	(r)
																983,045	(c)
Deferred income taxes and other liabilities		133,854			137		(137	)(p)		133,854			41,031			27,590	(l)		202,475
Deferred rent		—			—		—			—			30,214			(30,214	)(e)		—
Stockholders’ equity:
Partners’ equity		—			203,161		(203,161	)(f)		—			—			—			—
Preferred stock		—			—		—			—			—			—			—
Common stock		650			—		—			650			15			(15	)(f)		842
																192	(g)
Treasury stock		—			—		—			—			(3,333	)		3,333	(f)		—
Additional paid in capital		162,123			—		—			162,123			95,398			(95,398	)(f)		486,090
																321,267	(g)
																2,700	(s)
Retained earnings		283,352			—		—			283,352			135,355			(135,355	)(f)		280,117
																(3,235	)(k)
Accumulated other comprehensive losses, net		(4,872	)		—		—			(4,872	)		—			—			(4,872	)

Total equity		441,253			203,161		(203,161	)		441,253			227,435			93,489			762,177

Total liabilities and equity	$	1,872,997		$	363,760	$	(157,760	)	$	2,078,997		$	839,935		$	629,666		$	3,548,598

See the accompanying Notes to the Unaudited Pro Forma Condensed Combined Financial Statements, which are an integral part of these statements, beginning on page 88.

UNAUDITED PRO FORMA CONDENSED COMBINED

STATEMENT OF OPERATIONS

YEAR ENDED DECEMBER 31, 2003

(dollars in thousands, except per share amounts)


	Boyd Gaming Historical		Shreveport Partnership Historical		Pro Forma Adjustments			Boyd Gaming Pro Forma Combined		Coast Casinos Historical		Pro Forma Adjustments			Combined Company Pro Forma
Revenues
Gaming	$	1,073,736	$	169,988	$	—		$	1,243,724	$	431,160	$	—		$	1,674,884
Food and beverage		165,899		21,712		—			187,611		115,333		—			302,944
Room		76,819		14,964		—			91,783		52,635		—			144,418
Other		78,075		4,023		—			82,098		46,476		—			128,574

Gross revenues		1,394,529		210,687		—			1,605,216		645,604		—			2,250,820
Less promotional allowances		141,459		33,568		—			175,027		53,106		—			228,133

Net revenues		1,253,070		177,119		—			1,430,189		592,498		—			2,022,687

Costs and expenses
Gaming		535,388		91,502		—			626,890		174,912		—			801,802
Food and beverage		96,096		7,500		—			103,596		85,726		—			189,322
Room		22,058		1,500		—			23,558		20,909		—			44,467
Other		81,706		3,000		—			84,706		39,818		—			124,524
Selling, general and administrative		194,180		13,623		—			207,803		108,952		—			316,755
Maintenance and utilities		56,581		16,998		—			73,579		—		—			73,579
Depreciation and amortization		94,224		15,000		200	(t)		109,424		48,962		4,000	(t)		162,386
Corporate expense		22,595		—		—			22,595		—		—			22,595
Management fee		—		13,695		(13,695	)(u)		—		—		—			—
Land leases		—		—		—			—		5,365		—			5,365
Deferred rent		—		—		—			—		3,118		—			3,118
Reserve for asset write-downs		—		1,144		—			1,144		—		—			1,144

Total		1,102,828		163,962		(13,495	)