EXHIBIT 5.1
February 12, 2001
C 18514-NM
Coast Hotels and Casinos, Inc.
Coast Resorts, Inc.
4500 West Tropicana Avenue
Las Vegas, Nevada 89103
Re: Exchange of up to $50,000,000 Principal Amount of 9 1/2% Senior
Subordinated Notes due 2009
Ladies and Gentlemen:
We have acted as special counsel for Coast Hotels and Casinos, Inc., a
Nevada corporation (the "Company"), and Coast Resorts, Inc., a Nevada
corporation (the "Guarantor") (together with the Company, the "Registrants"), in
connection with the Company's proposed offer to exchange (the "Exchange Offer")
up to $50,000,000 aggregate principal amount of 9 1/2% Senior Subordinated Notes
due 2009 registered under the Securities Act of 1933, as amended (the "Exchange
Notes"), of the Company for a like amount of 9 1/2% Senior Subordinated Notes
due 2009 issued February 2, 2001 (the "Outstanding Additional Notes"). The
Exchange Notes will be unconditionally guaranteed on an unsecured, senior
subordinated basis (the "Note Guarantee") by the Guarantor. The Exchange Notes
will be issued under the Indenture dated as of March 23, 1999, as amended by the
First Supplemental Indenture dated as of November 20, 2000 and the Second
Supplemental Indenture dated as of February 2, 2001 (the "Indenture"), by and
among the Company, the Guarantor and Firstar Bank of Minnesota, N.A., as trustee
(in such capacity, the "Trustee"). Capitalized terms not otherwise defined
herein shall have the meanings set forth in the Indenture.
As such counsel, we have examined, among other things, (i) the Registration
Statement on Form S-4 (File Nos. 333-55170 and 333-55170-01) filed by the
Registrants with the Securities and Exchange Commission ("Commission") to
register under the Securities Act of 1933, as amended, the
Coast Hotels and Casinos, Inc.
February 12, 2001
Page 2
issuance of the Exchange Notes and the Note Guarantee; (ii) the Indenture; (iii)
the form of the Exchange Notes to be issued in the Exchange Offer; and (iv) the
form of the Note Guarantee. The Indenture, the Exchange Notes and the Note
Guarantee are sometimes referred to herein collectively as the "Documents." We
have also made such other inquiries and examined, among other things, originals
or copies, certified or otherwise identified to our satisfaction, of such
records, agreements, certificates, instruments and other documents as we have
considered necessary or appropriate for the purposes of this opinion.
We understand that you are receiving an opinion of even date herewith from
McDonald Carano Wilson McCune Bergin Frankovich & Hicks LLP with respect to,
among other things, certain matters of Nevada law.
In rendering this opinion, we have assumed:
(a) Each party to the Documents (i) has all requisite power and authority
to execute, deliver and perform its obligations thereunder, (ii) has duly
authorized, by all necessary action on such party's part, the execution and
delivery of each such Document and the performance of such obligations and (iii)
has duly executed and delivered each such Document;
(b) Each of the Documents is the legal, valid and binding obligation of,
and is enforceable against, each party thereto (other than the Company and the
Guarantor, as to which the assumptions in this clause (b) do not apply) in
accordance with its terms;
(c) The signatures on all documents examined by us are genuine, all
individuals executing such documents had all requisite legal capacity and
competency, and the documents submitted to us as originals are authentic and the
documents submitted to us as certified or reproduction copies conform to the
originals; and
(d) Each of the Company and the Guarantor is a corporation duly organized
and validly existing under the laws of the State of Nevada.
Based upon the foregoing and in reliance thereon, and subject to the
assumptions, exceptions, qualifications and limitations contained herein, we are
of the opinion that:
1. The Exchange Notes, when executed and authenticated in accordance with
the provisions of the Indenture in exchange for the Outstanding Notes, will be
duly issued and will be valid and binding obligations of the Company,
enforceable against the Company in accordance with their terms.
2. When the Exchange Notes have been executed and authenticated in
accordance with the provisions of the Indenture, the Note Guarantee will be a
valid and binding obligation of the Guarantor, enforceable against the Guarantor
in accordance with its terms.
Coast Hotels and Casinos, Inc.
February 12, 2001
Page 3
The foregoing opinions are subject to the following exceptions,
qualifications and limitations:
A. We render no opinion herein as to matters involving the laws of any
jurisdiction other than the State of New York and the United States of America.
This opinion is limited to the effect of the present state of the laws of the
State of New York, the United States of America and the facts as they presently
exist. We assume no obligation to revise or supplement this opinion in the
event of future changes in such laws or the interpretations thereof or such
facts.
B. Our opinions are subject to (i) the effect of any bankruptcy,
insolvency, reorganization, moratorium, arrangement or similar laws affecting
any rights and remedies of creditors generally (including, without limitation,
the effect of statutory or other laws regarding fraudulent transfers or
preferential transfers) and (ii) general principles of equity, including without
limitation concepts of materiality, reasonableness, good faith and fair dealing
and the possible unavailability of specific performance, injunctive relief or
other equitable remedies regardless of whether enforceability is considered in a
proceeding in equity or at law.
C. Our opinions are subject to (i) the effectiveness of any waiver
(whether or not stated as such) under the Documents of, or any consent
thereunder relating to, any unknown future rights or the rights of any party
thereto existing, or duties owing to it, as a matter of law; (ii) the
effectiveness of any waiver (whether or not stated as such) contained in the
Documents of rights of any party, or duties owing to it, that is broadly or
vaguely stated or does not describe the right or duty purportedly waived with
reasonable specificity; (iii) provisions relating to indemnification,
exculpation or contribution, to the extent such provisions may be held
unenforceable as contrary to public policy or federal or state securities laws
or due to the negligence or willful misconduct of the indemnified party; (iv)
the effect on the enforceability of the Note Guarantee against the Guarantor of
any facts or circumstances occurring after the date hereof that would constitute
a defense to the obligation of a surety, unless such defense has been waived
effectively by the Guarantor; (v) any provisions of the Documents that may be
construed as penalties or forfeitures; or (vi) the effectiveness of any
covenants (other than covenants relating to the payment of principal, interest,
make whole premium, indemnities and expenses) to the extent they are construed
to be independent requirements as distinguished from conditions to the
declaration or occurrence of a default or any event of default.
D. We express no opinion with respect to the legality, validity, binding
nature or enforceability of any provision of the Documents (i) to the effect
that rights or remedies are not exclusive, that every right or remedy is
cumulative and may be exercised in addition to any other right or remedy, that
the election of some particular remedy does not preclude recourse to one or more
others or that failure to exercise or delay in exercising rights or remedies
will not operate as a waiver of any such right or remedy or (ii) requiring
written amendments or waivers of such documents insofar as it suggests that oral
or other modifications, amendments or waivers could
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February 12, 2001
Page 4
not be effectively agreed upon by the parties or that the doctrine of promissory
estoppel might not apply.
E. We have assumed that there are no agreements or understandings between
or among the parties to the Documents or third parties that would expand, modify
or otherwise affect the terms of the Documents or the respective rights or
obligations of the parties thereunder.
F. We express no opinion as to the applicability to, or the effect of
noncompliance by, the Trustee with any state or federal laws applicable to the
transactions contemplated by the Documents because of the nature of the business
of such party.
This opinion is rendered solely for your benefit and the benefit of those
persons participating in the Exchange Offer. We hereby consent to the filing of
this opinion as an exhibit to the Registration Statement, and we further consent
to the use of our name under the caption "Legal Matters" in the Prospectus
forming a part of the Registration Statement. Except as stated above, without
our prior written consent, this may not be furnished or quoted to, or relied
upon by, any other person or entity for any purpose.
Very truly yours,
/s/ Gibson, Dunn & Crutcher LLP
GIBSON, DUNN & CRUTCHER LLP