CONDENSED CONSOLIDATING FINANCIAL INFORMATION

Separate condensed consolidating financial information for our subsidiary guarantors and non-guarantors of our 9.125% Senior Notes due December 2018 and 9.00% Senior Notes due July 2020 is presented below. The notes are fully and unconditionally guaranteed, on a joint and several basis, by certain of our current and future domestic restricted subsidiaries, all of which are 100% owned by us. The non-guarantors primarily represent special purpose entities, tax holding companies, our less significant operating subsidiaries and our less than wholly owned subsidiaries.

The tables below present the condensed consolidating balance sheets as of September 30, 2013 and December 31, 2012 and the condensed consolidating statements of operations for the three and nine months ended September 30, 2013 and 2012 and the condensed consolidating statements of cash flows for the nine months ended September 30, 2013 and 2012. The Company has corrected certain prior year amounts in the current year presentation to reflect certain intercompany activities between the parent and the sub-groups that had previously been excluded from the presentation, and to properly record the impact of certain reclassification entries within the correct sub-group.

Condensed Consolidating Balance Sheets



	September 30, 2013
							Non-			Non-
							Guarantor			Guarantor
							Subsidiaries			Subsidiaries
				Guarantor			(100%			(Not 100%
	Parent			Subsidiaries			Owned)			Owned)			Eliminations			Consolidated
(In thousands)
Assets
Cash and cash equivalents	$	—		$	99,487		$	30,866		$	35,450		$	—		$	165,803
Other current assets	90,894			(15,574		)	37,657			45,955			135			159,067
Property and equipment, net	63,431			1,839,262			448,036			1,174,817			—			3,525,546
Investments in subsidiaries	3,158,525			268,870			8,213			311			(3,435,919		)	—
Intercompany receivable	—			563,945			47,096			—			(611,041		)	—
Other assets, net	38,440			12,724			79,411			14,081			—			144,656
Intangible assets, net	—			466,676			556,060			60,344			—			1,083,080
Goodwill, net	—			212,795			482,134			—			—			694,929
Total assets	$	3,351,290		$	3,448,185		$	1,689,473		$	1,330,958		$	(4,046,825	)	$	5,773,081

Liabilities and Stockholders' Equity
Current maturities of long-term debt	$	21,500		$	—		$	8,259		$	—		$	—		$	29,759
Other current liabilities	57,662			214,282			68,169			103,274			(573		)	442,814
Intercompany payable	485,232			—			125,398			103			(610,733		)	—
Long-term debt, net of current maturities	2,265,508			—			1,293,995			753,481			—			4,312,984
Other long-term liabilities	11,617			186,586			47,832			30,925			92			277,052

Common stock	1,078			31,124			—			—			(31,124		)	1,078
Additional paid-in capital	894,222			2,736,895			244,003			480,833			(3,461,731		)	894,222
Retained earnings (deficit)	(384,734		)	279,298			(97,388		)	(37,658		)	(144,252		)	(384,734		)
Accumulated other comprehensive loss	(795		)	—			(795		)	—			795			(795		)
Total Boyd Gaming Corporation stockholders' equity	509,771			3,047,317			145,820			443,175			(3,636,312		)	509,771
Noncontrolling interest	—			—			—			—			200,701			200,701
Total stockholders' equity	509,771			3,047,317			145,820			443,175			(3,435,611		)	710,472
Total liabilities and stockholders' equity	$	3,351,290		$	3,448,185		$	1,689,473		$	1,330,958		$	(4,046,825	)	$	5,773,081

Condensed Consolidating Balance Sheets - continued



	December 31, 2012
							Non-			Non-
							Guarantor			Guarantor
							Subsidiaries			Subsidiaries
				Guarantor			(100%			(Not 100%
	Parent			Subsidiaries			Owned)			Owned)			Eliminations			Consolidated
(In thousands)
Assets
Cash and cash equivalents	$	2,520		$	118,714		$	36,619		$	34,692		$	—		$	192,545
Other current assets	87,493			(4,371		)	32,460			50,751			(3,970		)	162,363
Current assets from discontinued operation	—			—			685			—			—			685
Property and equipment, net	67,500			1,691,120			462,986			1,365,708			—			3,587,314
Assets held for development	775			330,995			—			—			—			331,770
Investments in subsidiaries	3,089,125			267,777			4,103			—			(3,361,005		)	—
Intercompany receivable	(134,385		)	264,686			10			(224		)	(130,087		)	—
Other assets, net	45,880			12,791			81,846			64,748			—			205,265
Intangible assets, net	—			468,229			589,845			61,564			—			1,119,638
Goodwill, net	—			212,795			482,134			—			—			694,929
Noncurrent assets from discontinued operation	—			—			37,684			—			—			37,684
Total assets	$	3,158,908		$	3,362,736		$	1,728,372		$	1,577,239		$	(3,495,062	)	$	6,332,193

Liabilities and Stockholders' Equity
Current maturities of long-term debt	$	42,500		$	10,341		$	8,729		$	—		$	—		$	61,570
Non-recourse debt	—			—			—			225,113			—			225,113
Other current liabilities	66,121			208,399			79,928			109,442			(873		)	463,017
Current liabilities from discontinued operation	—			—			70,864			—			(70,000		)	864
Intercompany payable	—			—			58,198			—			(58,198		)	—
Long-term debt, net of current maturities	2,723,234			—			1,311,295			793,324			—			4,827,853
Other long-term liabilities	23,262			185,717			41,289			36,350			31			286,649

Preferred stock	—			—			—			—						—
Common stock	869			31,128			—			—			(31,128		)	869
Additional paid-in capital	655,694			2,756,184			250,504			480,833			(3,487,521		)	655,694
Retained earnings (deficit)	(351,810		)	170,967			(91,473		)	(67,823		)	(11,671		)	(351,810		)
Accumulated other comprehensive loss	(962		)	—			(962		)	—			962			(962		)
Total Boyd Gaming Corporation stockholders' equity	303,791			2,958,279			158,069			413,010			(3,529,358		)	303,791
Noncontrolling interest	—			—			—			—			163,336			163,336
Total stockholders' equity	303,791			2,958,279			158,069			413,010			(3,366,022		)	467,127
Total liabilities and stockholders' equity	$	3,158,908		$	3,362,736		$	1,728,372		$	1,577,239		$	(3,495,062	)	$	6,332,193

Condensed Consolidating Statements of Operations



	Three Months Ended September 30, 2013
							Non-			Non-
							Guarantor			Guarantor
							Subsidiaries			Subsidiaries
				Guarantor			(100%			(Not 100%
	Parent			Subsidiaries			Owned)			Owned)			Eliminations			Consolidated
(In thousands)
Net revenues	$	32,018		$	395,991		$	147,905		$	200,051		$	(37,396	)	$	738,569

Costs and expenses
Operating	462			223,748			80,857			100,573			—			405,640
Selling, general and administrative	11,698			58,809			15,510			36,830			(10		)	122,837
Maintenance and utilities	—			25,639			4,040			16,056			—			45,735
Depreciation and amortization	1,610			30,281			22,774			14,337			—			69,002
Corporate expense	11,423			(7		)	668			—			—			12,084
Preopening expense	(537		)	—			1,883			329			—			1,675
Impairments of assets	—			1,250			—			—			—			1,250
Asset transactions costs	(1,692		)	399			132			(201		)	—			(1,362		)
Other operating charges and credits, net	134			43			63			3,146			—			3,386
Intercompany expenses	301			26,885			10,200			—			(37,386		)	—
Total costs and expenses	23,399			367,047			136,127			171,070			(37,396		)	660,247

Equity in earnings of subsidiaries	11,012			(4,291		)	—			—			(6,721		)	—
Operating income (loss)	19,631			24,653			11,778			28,981			(6,721		)	78,322

Other expense (income)
Interest expense, net	36,936			2,270			23,104			20,282			—			82,592
Loss on early extinguishments of debt	24,605			—			—			2,536			—			27,141
Other, net	136			—			—			—			—			136
Total other expense, net	61,677			2,270			23,104			22,818			—			109,869

Income (loss) from continuing operations before income taxes	(42,046		)	22,383			(11,326		)	6,163			(6,721		)	(31,547		)
Income taxes benefit (expense)	4,779			(1,336		)	(5,760		)	(731		)	—			(3,048		)
Income (loss) from continuing operations, net of tax	(37,267		)	21,047			(17,086		)	5,432			(6,721		)	(34,595		)
Income (loss) from discontinued operations, net of tax	—			—			—			—			—			—
Net income (loss)	(37,267		)	21,047			(17,086		)	5,432			(6,721		)	(34,595		)
Net loss attributable to noncontrolling interest	—			—			—			—			(2,672		)	(2,672		)
Net income (loss) attributable to controlling interest	$	(37,267	)	$	21,047		$	(17,086	)	$	5,432		$	(9,393	)	$	(37,267	)
Comprehensive income (loss)	$	(37,215	)	$	21,047		$	(17,034	)	$	5,432		$	(6,773	)	$	(34,543	)

Condensed Consolidating Statements of Operations - continued



	Three Months Ended September 30, 2012
							Non-			Non-
							Guarantor			Guarantor
							Subsidiaries			Subsidiaries
				Guarantor			(100%			(Not 100%
	Parent			Subsidiaries			Owned)			Owned)			Eliminations			Consolidated
(In thousands)
Net revenues	$	27,949		$	413,281		$	12,554		$	189,815		$	(31,209	)	$	612,390

Costs and expenses
Operating	456			235,163			12,796			102,357			—			350,772
Selling, general and administrative	11,331			63,579			2,008			35,475			—			112,393
Maintenance and utilities	—			21,532			483			15,914			—			37,929
Depreciation and amortization	1,925			31,567			624			16,308			—			50,424
Corporate expense	9,877			25			415			—			—			10,317
Preopening expense	589			3,493			260			—			(2,724		)	1,618
Asset transactions costs	645			—			—			—			—			645
Other operating charges and credits, net	—			524			5			(1,624		)	—			(1,095		)
Intercompany expenses	346			27,644			495			—			(28,485		)	—
Total costs and expenses	25,169			383,527			17,086			168,430			(31,209		)	563,003

Equity in earnings of subsidiaries	10,122			(2,584		)	—			—			(7,538		)	—
Operating income (loss)	12,902			27,170			(4,532		)	21,385			(7,538		)	49,387

Other expense (income)
Interest expense, net	43,415			3,350			3,342			23,736			—			73,843
Total other expense, net	43,415			3,350			3,342			23,736			—			73,843

Income (loss) from continuing operations before income taxes	(30,513		)	23,820			(7,874		)	(2,351		)	(7,538		)	(24,456		)
Income taxes benefit (expense)	14,717			(7,828		)	1,124			37						8,050
Income (loss) from continuing operations, net of tax	(15,796		)	15,992			(6,750		)	(2,314		)	(7,538		)	(16,406		)
Income (loss) from discontinued operations, net of tax	—			—			(676		)	—			—			(676		)
Net income (loss)	(15,796		)	15,992			(7,426		)	(2,314		)	(7,538		)	(17,082		)
Net loss attributable to noncontrolling interest	—			—			—			—			1,286			1,286
Net income (loss) attributable to controlling interest	$	(15,796	)	$	15,992		$	(7,426	)	$	(2,314	)	$	(6,252	)	$	(15,796	)
Comprehensive income (loss)	$	(15,796	)	$	15,992		$	(7,426	)	$	(1,080	)	$	(7,538	)	$	(15,848	)

Condensed Consolidating Statements of Operations



	Nine Months Ended September 30, 2013
							Non-			Non-
							Guarantor			Guarantor
							Subsidiaries			Subsidiaries
				Guarantor			(100%			(Not 100%
	Parent			Subsidiaries			Owned)			Owned)			Eliminations			Consolidated
(In thousands)
Net revenues	$	106,132		$	1,238,422		$	452,555		$	540,505		$	(124,713	)	$	2,212,901

Costs and expenses
Operating	1,386			680,970			241,394			279,676			—			1,203,426
Selling, general and administrative	35,183			179,365			48,131			111,227			(41		)	373,865
Maintenance and utilities	—			70,087			11,073			44,826			—			125,986
Depreciation and amortization	5,008			90,992			67,910			45,448			—			209,358
Corporate expense	39,463			87			3,038			—			—			42,588
Preopening expense	563			2,892			2,920			387			(1,933		)	4,829
Impairments of assets	—			13,984			—			5,032			(12,734		)	6,282
Asset transactions costs	1,043			724			293			205			—			2,265
Other operating charges and credits, net	412			1,396			227			3,146			—			5,181
Intercompany expenses	912			90,132			31,695			—			(122,739		)	—
Total costs and expenses	83,970			1,130,629			406,681			489,947			(137,447		)	1,973,780

Equity in earnings of subsidiaries	84,122			13,379			—			—			(97,501		)	—
Operating income (loss)	106,284			121,172			45,874			50,558			(84,767		)	239,121

Other expense (income)
Interest expense, net	121,004			7,632			72,262			64,276			—			265,174
Loss on early extinguishments of debt	25,001			—			1,976			2,536			—			29,513
Other, net	136			—			(471		)	—			—			(335		)
Total other expense, net	146,141			7,632			73,767			66,812			—			294,352

Income (loss) from continuing operations before income taxes	(39,857		)	113,540			(27,893		)	(16,254		)	(84,767		)	(55,231		)
Income taxes benefit (expense)	6,933			(4,260		)	103			702			—			3,478
Income (loss) from continuing operations, net of tax	(32,924		)	109,280			(27,790		)	(15,552		)	(84,767		)	(51,753		)
Income (loss) from discontinued operations, net of tax	—			—			23,524			—			(12,734		)	10,790
Net income (loss)	(32,924		)	109,280			(4,266		)	(15,552		)	(97,501		)	(40,963		)
Net loss attributable to noncontrolling interest	—			—			—			—			8,039			8,039
Net income (loss) attributable to controlling interest	$	(32,924	)	$	109,280		$	(4,266	)	$	(15,552	)	$	(89,462	)	$	(32,924	)
Comprehensive income (loss)	$	(32,757	)	$	109,280		$	(4,099	)	$	(15,552	)	$	(97,668	)	$	(40,796	)

Condensed Consolidating Statements of Operations - continued



	Nine Months Ended September 30, 2012
							Non-			Non-
							Guarantor			Guarantor
							Subsidiaries			Subsidiaries
				Guarantor			(100%			(Not 100%
	Parent			Subsidiaries			Owned)			Owned)			Eliminations			Consolidated
(In thousands)
Net revenues	$	91,626		$	1,281,805		$	39,303		$	546,829		$	(101,434	)	$	1,858,129

Costs and expenses
Operating	1,367			705,224			40,047			288,047			—			1,034,685
Selling, general and administrative	34,010			187,481			6,206			103,014			—			330,711
Maintenance and utilities	—			70,070			1,209			44,645			—			115,924
Depreciation and amortization	6,152			95,529			1,926			47,452			—			151,059
Corporate expense	35,272			(32		)	957			—			—			36,197
Preopening expense	1,494			11,317			609			240			(8,172		)	5,488
Asset transactions costs	6,917			—			—			—			—			6,917
Other operating charges and credits, net	—			(5,509		)	5			(3,812		)	—			(9,316		)
Intercompany expenses	1,011			90,766			1,485			—			(93,262		)	—
Total costs and expenses	86,223			1,154,846			52,444			479,586			(101,434		)	1,671,665

Equity in earnings of subsidiaries	61,297			(6,104		)	—			—			(55,193		)	—
Operating income (loss)	66,700			120,855			(13,141		)	67,243			(55,193		)	186,464

Other expense (income)
Interest expense, net	117,503			10,703			2,933			70,908			—			202,047
Total other expense, net	117,503			10,703			2,933			70,908			—			202,047

Income (loss) from continuing operations before income taxes	(50,803		)	110,152			(16,074		)	(3,665		)	(55,193		)	(15,583		)
Income taxes benefit (expense)	41,836			(38,456		)	3,183			(136		)	—			6,427
Income (loss) from continuing operations, net of tax	(8,967		)	71,696			(12,891		)	(3,801		)	(55,193		)	(9,156		)
Income (loss) from discontinued operations, net of tax	—			—			(2,142		)	—			—			(2,142		)
Net income (loss)	(8,967		)	71,696			(15,033		)	(3,801		)	(55,193		)	(11,298		)
Net loss attributable to noncontrolling interest	—			—			—			—			2,331			2,331
Net income (loss) attributable to controlling interest	$	(8,967	)	$	71,696		$	(15,033	)	$	(3,801	)	$	(52,862	)	$	(8,967	)
Comprehensive income (loss)	$	(8,967	)	$	71,696		$	(15,033	)	$	(100	)	$	(55,193	)	$	(7,597	)

Condensed Consolidating Statements of Cash Flows



	Nine Months Ended September 30, 2013
							Non-			Non-
							Guarantor			Guarantor
							Subsidiaries			Subsidiaries
				Guarantor			(100%			(Not 100%
	Parent			Subsidiaries			Owned)			Owned)			Eliminations			Consolidated
(In thousands)
Cash flows from operating activities
Net cash from operating activities	$	143,937		$	16,964		$	12,695		$	64,420		$	(4,233	)	$	233,783

Cash flows from investing activities
Capital expenditures	(22,922		)	(36,191		)	(25,107		)	(16,398		)	—			(100,618		)
Proceeds from sale of Echelon	343,750			—			—			—			—			343,750
Cash paid for exercise of LVE option	(187,000		)													(187,000		)
Proceeds from sale of other assets, net	4,875															4,875
Investment in subsidiaries	(4,233		)	—			—			—			4,233			—
Other investing activities	—			—			222			(24		)				198
Net cash from investing activities	134,470			(36,191		)	(24,885		)	(16,422		)	4,233			61,205

Cash flows from financing activities
Borrowings under bank credit facility	2,711,375			—			268,500			297,100						3,276,975
Payments under bank credit facility	(2,738,325		)	—			(296,688		)	(300,800		)				(3,335,813		)
Debt financing costs, net	(23,562		)	—			(10,288		)	(2,546		)				(36,396		)
Payments on notes payable	(10,341		)	—			(477		)	—						(10,818		)
Payments on early retirement of debt	(459,278		)	—			—			(40,994		)				(500,272		)
Distribution to parent	9,500			—			(9,500		)	—			—			—
Proceeds from stock options exercised	13,591			—			—			—						13,591
Restricted stock units released, net	(354		)	—			—			—						(354		)
Proceeds from sale of common stock, net	216,467			—			—			—						216,467
Net cash from financing activities	(280,927		)	—			(48,453		)	(47,240		)	—			(376,620		)


Cash flows from discontinued operations
Cash flows from operating activities	—			—			(2,144		)	—			—			(2,144		)
Cash flows from investing activities	—			—			56,751			—			—			56,751
Cash flows from financing activities	—			—			—			—			—			—
Net cash flows from discontinued operations	—			—			54,607			—			—			54,607

Net change in cash and cash equivalents	(2,520		)	(19,227		)	(6,036		)	758			—			(27,025		)
Cash and cash equivalents, beginning of period	2,520			118,714			36,619			34,692			—			192,545
Change in cash classified as discontinued operations	—			—			283			—			—			283
Cash and cash equivalents, end of period	$	—		$	99,487		$	30,866		$	35,450		$	—		$	165,803

Condensed Consolidating Statements of Cash Flows - continued



	Nine Months Ended September 30, 2012
							Non-			Non-
							Guarantor			Guarantor
							Subsidiaries			Subsidiaries
				Guarantor			(100%			(Not 100%
	Parent			Subsidiaries			Owned)			Owned)			Eliminations		Consolidated
(In thousands)
Cash flows from operating activities
Net cash from operating activities	$	(101,627	)	$	17,141		$	190,413		$	41,554		$	—	$	147,481

Cash flows from investing activities
Capital expenditures	(40,641		)	(26,807		)	120			(33,994		)	—		(101,322		)
Deposit of acquisition financing proceeds into escrow	—			—			(350,000		)	—			—		(350,000		)
Investment in subsidiaries	88			—			—			(88		)	—		—
Other investing activities	—			225			20			3,809			—		4,054
Net cash from investing activities	(40,553		)	(26,582		)	(349,860		)	(30,273		)	—		(447,268		)

Cash flows from financing activities
Borrowings under bank credit facility	642,600			—			—			515,300			—		1,157,900
Payments under bank credit facility	(836,375		)	—			—			(541,800		)	—		(1,378,175		)
Debt financing costs, net	(2,664		)	—			—			(217		)	—		(2,881		)
Proceeds from issuance of debt	338,500			—			—			2,668			—		341,168
Proceeds from acquisition financing	—			—			350,000			—			—		350,000
Payments on non-recourse debt of variable interest entity	—			—			—			(755		)	—		(755		)
Other financing activities	117			(544		)	—			—			—		(427		)
Net cash from financing activities	142,178			(544		)	350,000			(24,804		)	—		466,830

Cash flows from discontinued operations
Cash flows from operating activities	—			—			(1,636		)	—			—		(1,636		)
Cash flows from investing activities	—			—			(392		)	—			—		(392		)
Cash flows from financing activities	—			—			—			—			—		—
Net cash from discontinued operations	—			—			(2,028		)	—			—		(2,028		)

Net change in cash and cash equivalents	(2		)	(9,985		)	188,525			(13,523		)	—		165,015
Cash and cash equivalents, beginning of period	364			128,185			3,279			46,263			—		178,091
Change in cash classified as discontinued operations	—			—			373			—			—		373
Cash and cash equivalents, end of period	$	362		$	118,200		$	192,177		$	32,740		$	—	$	343,479