Custody Agreement (2009)Full Document 

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THIS CUSTODY AGREEMENT (as the same may be amended or modified from time to time pursuant hereto, this “Custody Agreement”) is made and entered into as of August 19, 2009, by and between Kien Huat Realty III Limited, a corporation organized in the Isle of Man (the “Purchaser”) and JPMorgan Chase Bank, National Association (the “Custodian”).


WHEREAS, pursuant to the Underlying Agreement, the Purchaser has agreed to make an investment in Empire Resorts, Inc. (the “Company”) and the Company has agreed to issue, in exchange for such investment, certificated shares of common stock of the Company and certificated shares of preferred stock of the Company from time to time, in each case, in physical form (collectively, the “Acquired Shares”),


WHEREAS, the Purchaser desires to place and maintain such Acquired Shares in the custody of the Custodian until such time as the Purchaser has obtained the necessary gaming licenses and permits required under Article III of the Racing, Pari-Mutuel Wagering and Breeding Law of the State of New York and the regulations promulgated by the New York State Division of Lottery, as codified in 21 NYCRR Part 2836, and


WHEREAS, the Custodian has indicated its willingness to act as custodian of the Acquired Shares on the terms and conditions set forth herein.


NOW THEREFORE, in consideration of the foregoing and of the mutual covenants hereinafter set forth, the Purchaser and the Custodian hereto agree as follows:


1.             Appointment. The Purchaser hereby appoints the Custodian as custodian of the Acquired Shares to be delivered to the Custodian for the purposes set forth herein, and the Custodian hereby accepts such appointment under the terms and conditions set forth herein.


2.             Definitions. Capitalized terms used herein shall have the meanings ascribed to such terms on Exhibit A attached hereto.


3.            Certification as to Authorized Persons. The Authorized Persons are listed on Schedule 1 attached hereto. The Purchaser will notify the Custodian in writing of the names and signatures of new Authorized Persons from time to time. The Custodian will be entitled to rely and act upon any Officer’s Certificate/Proper Instructions given to it by the Purchaser which has been signed by an Authorized Person


4.             Custody Account. As custodian for the Purchaser, the Custodian will open and maintain a separate account or accounts in the name of the Purchaser, and will hold in such account(s) either cash or securities deposited by the Purchaser. All of the cash of the Purchaser, delivered to the Custodian in respect of the Acquired Shares, shall include, without limitation, funds delivered from any sale of the Acquired Shares and any dividends paid in respect of such Acquired Shares. Upon receipt by the Custodian of Proper Instructions in accordance with Section 14 below (which may be continuing instructions), requesting payment, designating the payee or the account or accounts to which the Custodian will release funds for deposit, the Custodian will make payments of cash held for the account of the Purchaser. All cash held hereunder will be held by the Custodian uninvested and in a non-interest bearing account.


5.             Acquired Shares.







(a)          Segregation and Registration. The Custodian, will receive and hold at all times from those of other persons, any and all Acquired Shares which may now or hereafter be delivered to it by or for the account of the Purchaser pursuant to the Underlying Agreement, whether delivered by the Purchaser, the Company or any other person or entity on behalf of the Purchaser. All such Acquired Shares will be held or disposed of by the Custodian solely in accordance with the written instructions of the Purchaser pursuant to the terms of this Agreement. The Acquired Shares will initially be registered in the name of Kien Huat Realty III Limited. The Custodian may deposit securities with, and hold securities in, any securities depository, settlement system, dematerialized book entry system or similar system (together a "Securities Depository") on such terms as such systems customarily operate and the Company will provide the Custodian with such documentation or acknowledgements that the Custodian may require to hold the securities in such systems. The Custodian is not responsible for the selection or monitoring of any Securities Depository and will have no responsibility for any act or omission by (or the insolvency of) any Securities Depository. In the event the Purchaser incurs a loss due to the negligence, willful misconduct, or insolvency of a Securities Depository, the Purchaser will make reasonable endeavors, in its discretion, to seek recovery from the Securities Depository, but Custodian will not be obligated to institute legal proceedings, file proofs of claim in any insolvency proceeding, or take any similar action.

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