Exhibit 10.2

LOAN AGREEMENT

Dated as of December 28, 2017

between

EMPIRE RESORTS, INC.,

as Borrower,

and

KIEN HUAT REALTY III LIMITED,

as Lender

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TABLE OF CONTENTS

Page

 

ARTICLE I

 

DEFINITIONS

  

SECTION 1.01.       Definitions

   1

SECTION 1.02.       General Construction

   4

ARTICLE II

 

GENERAL TERMS

  

SECTION 2.01.       The Loan

   5

SECTION 2.02.       [Reserved]

   5

SECTION 2.03.       Interest and Principal; Commitment Fee

   5

SECTION 2.04.       Method and Place of Payment

   6

SECTION 2.05.       Increased Costs

   6

SECTION 2.06.       Application of Payments; Offset

   7

SECTION 2.07.       Taxes.

   7

ARTICLE III

 

ADVANCES

  

SECTION 3.01.       Conditions to Advance

   7

ARTICLE IV

 

REPRESENTATIONS AND WARRANTIES

  

SECTION 4.01.       Organization

   8

SECTION 4.02.       Authorization

   8

SECTION 4.03.       No Conflicts

   8

SECTION 4.04.       Enforceable Obligations

   8

SECTION 4.05.       Compliance with Anti-Terrorism, Embargo, Sanctions and
Anti-Money Laundering Laws

   8

SECTION 4.06.       Survival

   9

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(continued)

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ARTICLE V

 

AFFIRMATIVE COVENANTS

  

SECTION 5.01.       Maintenance of Existence

   9

SECTION 5.02.       Compliance with Laws

   9

SECTION 5.03.       Use of Proceeds

   9

ARTICLE VI

 

SUBORDINATION

  

ARTICLE VII

 

EVENTS OF DEFAULT

  

SECTION 7.01.       Event of Default

   11

SECTION 7.02.       Remedies

   13

SECTION 7.03.       No Waiver

   13

SECTION 7.04.       Application of Payments after an Event of Default

   14

ARTICLE VIII

 

MISCELLANEOUS

  

SECTION 8.01.       Successors

   14

SECTION 8.02.       Governing Law

   14

SECTION 8.03.       Modification; Waiver in Writing

   15

SECTION 8.04.       Notices

   15

SECTION 8.05.       TRIAL BY JURY

   16

SECTION 8.06.       Headings

   17

SECTION 8.07.       No Assignment

   17

SECTION 8.08.       Expenses

   17

SECTION 8.09.       Severability

   17

SECTION 8.10.       Preferences

   17

SECTION 8.11.       Remedies of Borrower

   18

SECTION 8.12.       Offsets, Counterclaims and Defenses

   18

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TABLE OF CONTENTS

(continued)

Page

 

SECTION 8.13.       No Joint Venture

   18

SECTION 8.14.       Conflict; Construction of Documents

   18

SECTION 8.15.       Brokers and Financial Advisors

   18

SECTION 8.16.       Counterparts

   18

SECTION 8.17.       Register

   19

SECTION 8.18.       General Indemnity.

   19

SECTION 8.19.       Third-Party Beneficiaries

   20

SECTION 8.20.       Right of Set-Off

   20

SECTION 8.21.       Exculpation of Lender

   20

SECTION 8.22.       No Fiduciary Duty.

   21

SECTION 8.23.       PATRIOT Act Records

   22

SECTION 8.24.       Prior Agreements

   22

SECTION 8.25.       Delay Not a Waiver

   22

SECTION 8.26.       Determinations

   22

EXHIBIT A – Form of Request for Advance

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THIS LOAN AGREEMENT (this “Agreement”), made as of December 28, 2017, between
EMPIRE RESORTS, INC., a Delaware corporation, as borrower (“Borrower”), and KIEN
HUAT REALTY III LIMITED, a corporation organized in the Isle of Man, as lender
(together with its successors and assigns, “Lender”). Lender and Borrower are
hereinafter referred to collectively as the “Parties” or individually as a
“Party”.

RECITALS

WHEREAS, reference is made to that certain commitment letter dated as of
June 26, 2014, by and between Lender and Borrower (together with the term sheet
attached thereto, in each case as amended by those certain amendments dated as
of January 2, 2015 and September 22, 2015, by and between KHRL and Empire, the
“Commitment Letter”);

WHEREAS, as of the date hereof, the commitment made by Lender to Borrower to
consummate a Follow-on Standby Purchase (as defined in the Commitment Letter) in
connection with a Follow-On Rights Offering (as defined in the Commitment
Letter) has been terminated pursuant to that certain Termination of Follow-on
Standby Purchase Commitment, executed as of the date hereof;

WHEREAS, Borrower desires to obtain from Lender the Loan (as hereinafter
defined), the proceeds of which will be used exclusively to make payments
required under the Bank Loan; and

WHEREAS, Lender is willing to make the Loan on the terms and subject only to the
conditions set forth in this Agreement.

NOW, THEREFORE, in consideration of the agreements, provisions and covenants
contained herein, and for other good and valuable consideration, the sufficiency
of which is hereby acknowledged, Lender and Borrower agree as follows:

ARTICLE I

DEFINITIONS

SECTION 1.01. Definitions. When used herein, the following capitalized terms
shall have the following meanings:

“Affiliate” with respect to any Person means any Person directly or indirectly
controlling, controlled by or under common control with, such Person. For the
purposes of this Agreement, “control” (including, with correlative meaning, the
terms “controlling” and “controlled”) shall mean the possession, directly or
indirectly, of the power to direct or cause the direction of the management and
policies of such Person, whether through the ownership of voting securities, by
contract or otherwise.

“Agreement” has the meaning specified in the preamble.

“Bank Loan” means the loan made pursuant to the Bank Loan Agreement.

 

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“Bank Loan Agreement” means the Delayed Draw Term Loan Credit Agreement, dated
as of December 28, 2017, between Empire Resorts, Inc., as the Borrower,
Monticello Raceway Management, Inc., as the Guarantor, and Bangkok Bank PCL, New
York Branch, as the Lender.

“Bank Lender” means Bangkok Bank PCL, New York Branch.

“Bankruptcy Code” has the meaning specified in Section 7.01(d).

“Borrower” has the meaning specified in the preamble.

“Business Day” means any day other than (i) a Saturday, (ii) a Sunday, (iii) a
day on which federally insured depository institutions located in the State of
New York are required or authorized by Law to close, or (iv) a day on which
banking institutions located in Singapore or Malaysia are required or authorized
by Law to close.

“Closing Date” shall mean the date hereof.

“Code” means the Internal Revenue Code of 1986, as amended, and applicable U.S.
Department of Treasury regulations issued pursuant thereto in temporary or final
form.

“Commitment Fee” means a commitment fee equal to $200,000.

“Damages” to a Party means any and all liabilities, obligations, losses,
demands, damages, penalties, assessments, actions, causes of action, judgments,
proceedings, suits, claims, costs, expenses and disbursements of any kind or
nature whatsoever (including reasonable attorneys’ fees and other costs of
defense and/or enforcement whether or not suit is brought), fines, charges,
fees, settlement costs and disbursements imposed on, incurred by or asserted
against such Party, whether based on any federal, state or foreign Laws,
statutes, rules or regulations (including securities and commercial laws,
statutes, rules or regulations and environmental Laws), on common law or
equitable cause or on contract or otherwise.

“Default Rate” means, with respect to the Note, 5.00% per annum in excess of the
Interest Rate.

“Dollars” or “$” means lawful money of the United States of America.

“Embargoed Person” has the meaning specified in Section 4.07.

“Event of Default” has the meaning specified in Section 7.01.

“GAAP” means the generally accepted accounting principles in the United States
of America in effect from time to time.

“Governmental Authority” means any nation or government, any state, county,
regional, local or municipal government, any bureau, department, agency or other
political subdivision thereof, including, without limitation, the New York State
Gaming Commission, and any entity exercising executive, legislative, judicial,
regulatory or administrative functions of, or pertaining to, government
(including any court).

 

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“Governmental Authorization” means any permit, license, authorization, plan,
directive, consent order or consent decree of or from any Governmental
Authority.

“Indebtedness” means the Principal Indebtedness, together with interest and all
other obligations and liabilities of Borrower under the Loan Documents,
including all transaction costs and other amounts due or to become due to Lender
pursuant to this Agreement, the Note or in accordance with any of the other Loan
Documents, and all other amounts, sums and expenses reimbursable by Borrower to
Lender hereunder, pursuant to the Note or any other Loan Document.

“Indemnified Parties” has the meaning specified in Section 8.18.

“Interest Accrual Period” means the period commencing on and including the first
day of each calendar month during the Term of the Loan and ending on and
including the last day of such calendar month; however, the initial Interest
Accrual Period shall commence on and include the initial Advance hereunder and
shall end on and include the final calendar day of the calendar month in which
the initial Advance occurs.

“Interest Payment Date” means the first Business Day of each calendar month
beginning on January 1, 2018.

“Interest Rate” means 12% per annum.

“Law” means any federal, state, local or foreign law, including common law, and
any regulation, rule, requirement, policy, judgment, order, writ, decree,
ruling, award, approval, authorization, consent, license, waiver, variance,
guideline or permit of, or any agreement with, any Governmental Authority.

“Lender” has the meaning specified in the preamble.

“Lending Parties” has the meaning specified in Section 8.22.

“Loan” has the meaning specified in Section 2.01.

“Loan Amount” means $20,000,000.00.

“Loan Documents” means, collectively, this Agreement, the Note and any and all
other documents and agreements executed in connection with the Indebtedness, as
each such agreement may be modified, supplemented, consolidated, extended or
reinstated from time to time.

“Material Adverse Effect” means a material adverse effect on and/or material
adverse development with respect to (i) the business, results of operations,
properties, assets or condition (financial or otherwise) of Borrower, (ii) the
ability of Borrower to perform, or of Lender to enforce, any material provision
of any Loan Document; or (iii) the legality, validity, binding effect, or
enforceability of any material provision of any Loan Document.

 

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“Maturity Date” means one year after the maturity date or earlier termination of
the Bank Loan, or such earlier date as may result from acceleration of the Loan
in accordance with this Agreement.

“Note” means that certain promissory note, dated as of the Closing Date, made by
Borrower to the order of Lender to evidence the Loan, as such note may be
modified and/or replaced from time to time in accordance herewith.

“Notices” has the meaning specified in Section 8.04.

“Party” or “Parties” has the meaning specified in the preamble.

“PATRIOT Act” means the Uniting and Strengthening America by Providing
Appropriate Tools Required To Intercept and Obstruct Terrorism Act (Title III of
Pub. L. 107-56 (signed into Law on October 26, 2001)), as amended from time to
time.

“Person” means an individual, corporation, association, limited liability
company, limited liability partnership, partnership, estate, trust,
unincorporated organization or a government or any agency or political
subdivision thereof.

“Principal Indebtedness” means the principal balance of the Loan outstanding
from time to time.

“Request for Advance” means a written request for an Advance, substantially in
the form attached hereto as Exhibit A, and signed by a duly authorized
representative of Borrower.

“Taxes” means, collectively, all taxes, levies, duties, imposts, deductions,
charges, fees or withholdings, and all interest, penalties and other liabilities
imposed by a Governmental Authority or taxing authority in any jurisdiction.

“U.S.” means the United States of America.

“U.S. Person” means a United States person within the meaning of
Section 7701(a)(30) of the Code.

“U.S. Tax” means any present or future tax, assessment or other charge or levy
imposed by or on behalf of the U.S. or any taxing authority thereof.

SECTION 1.02. General Construction. Defined terms used in this Agreement may be
used interchangeably in singular or plural form, and pronouns are to be
construed to cover all genders. All references to this Agreement or any
agreement or instrument referred to in this Agreement shall mean such agreement
or instrument as originally executed and as hereafter amended, supplemented,
extended, consolidated or restated from time to time. The words “herein,”
“hereof” and “hereunder” and other words of similar import refer to this
Agreement as a whole and not to any particular subdivision; and the words
“Article” and

 

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“section” refer to the entire article or section, as applicable and not to any
particular subsection or other subdivision. Reference to days for performance
means calendar days unless Business Days are expressly indicated. All references
to sections, schedules and exhibits are to sections, schedules and exhibits in
or to this Agreement unless otherwise specified. Unless otherwise specified: (i)
“including” means “including, but not limited to”. All accounting terms not
specifically defined in this Agreement shall be construed in accordance with
GAAP, as the same may be modified in this Agreement.

ARTICLE II

GENERAL TERMS

SECTION 2.01. The Loan. Lender hereby agrees to make an advance to Borrower
solely in respect of amounts owed by Borrower to Bank Lender under the Bank Loan
Agreement and for no other purpose (an “Advance” or a “Loan”) in accordance with
and subject to the provisions of Article III in a maximum aggregate principal
amount equal to the Loan Amount. The term (the “Term”) of the Loan shall
terminate and expire and Lender shall have no obligation to make an Advance
hereunder from (and including) the date that is one year after the maturity date
or earlier termination of the Bank Loan. The Loan shall be represented by a
single Note that shall bear interest as described in this Agreement at a per
annum rate equal to the Interest Rate. The Loan is not in the nature of a
revolving credit facility, and any amount borrowed and repaid may not be
re-borrowed.

SECTION 2.02. [Reserved].

SECTION 2.03. Interest and Principal; Commitment Fee.

(a) On each Interest Payment Date, Borrower shall pay to Lender interest accrued
on the Loan, in arrears, for the immediately preceding Interest Accrual Period
(except that on the initial Interest Payment Date, Borrower shall pay all
interest accrued on the Loan from the date of the initial Advance until such
date, even though such interest may have been accruing for more than one
Interest Accrual Period) at a rate per annum equal to the Interest Rate (except
that interest shall be payable on the Indebtedness, including due but unpaid
interest, at the Default Rate with respect to any portion of such Interest
Accrual Period falling during the continuance of an Event of Default). Interest
payable hereunder shall compound monthly and shall be computed on the basis of a
360-day year and the actual number of days elapsed.

(b) The Principal Indebtedness, together with interest through the end of the
applicable Interest Accrual Period and all other amounts then due under the Loan
Documents, shall be due and payable by Borrower to Lender on the Maturity Date.

(c) On the Closing Date, as a condition precedent to the effectiveness of this
Agreement, Borrower shall pay to Lender the Commitment Fee.

(d) Partial or full prepayment of the Loan shall be permitted at any time
without premium, fee or penalty.

 

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SECTION 2.04. Method and Place of Payment. Except as otherwise specifically
provided in this Agreement, all payments and prepayments under this Agreement
and the Note shall be made to Lender not later than 11:00 a.m., New York City
time, on the date when due and shall be made in lawful money of the United
States of America by wire transfer in federal or other immediately available
funds to the account specified from time to time by Lender. Any funds received
by Lender after such time shall be deemed to have been paid on the next
succeeding Business Day. Lender shall notify Borrower in writing of any changes
in the account to which payments are to be made. If the amount received from
Borrower pursuant to this Agreement is less than the sum of all amounts then due
and payable hereunder, such amount shall be applied, at Lender’s sole
discretion, toward the components of the Indebtedness (e.g., interest, principal
and other amounts payable hereunder) in such sequence as Lender shall elect in
its sole discretion.

SECTION 2.05. Increased Costs.

(a) If Lender determines, in its sole discretion, at any time that any Law or
treaty or any change therein or in the interpretation or application thereof
shall (i) impose, modify or deem applicable any reserve, special deposit or
similar requirement against assets of, deposits with or for the account of, or
credit extended by, Lender or (ii) impose on Lender any other condition
affecting this Agreement, and the result of any of the foregoing shall be to
increase the cost to Lender of making or maintaining the Loan, or to reduce the
amount of any sum received or receivable by Lender (whether principal, interest
or otherwise), then Borrower will pay to Lender such additional amount or
amounts as will compensate Lender for such additional costs incurred or
reduction suffered.

(b) If Lender determines, in its sole discretion, at any time that any Law or
treaty or any change therein or in the interpretation or application thereof
regarding capital requirements has or would have the effect of reducing the rate
of return on Lender’s capital or on the capital of Lender’s holding company, if
any, as a consequence of this Agreement or the Loan made by Lender to a level
below that which Lender or Lender’s holding company, if any could have achieved
but for such change (taking into consideration Lender’s policies and the
policies of Lender’s holding company, if any with respect to capital adequacy),
then from time to time, Borrower will pay to Lender such additional amount or
amounts as will compensate Lender or Lender’s holding company, if any, for any
such reduction suffered.

(c) A certificate of Lender setting forth the amount(s) necessary to compensate
Lender or its holding company, if any, as specified in Section 2.05(b) shall be
delivered to Borrower and shall be conclusive absent manifest error. Borrower
shall pay to Lender the amount shown as due on any such certificate within ten
(10) days after receipt thereof.

(d) Failure or delay on the part of Lender to demand compensation pursuant to
this Section 2.05 shall not constitute a waiver of Lender’s right to demand such
compensation.

 

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(a) Lender hereby represents and warrants that, as of the Closing Date, to its
actual knowledge, there is no Law or treaty that would require Borrower to pay
to Lender any additional amounts pursuant to this Section 2.05.

SECTION 2.06. Application of Payments; Offset.

(a) Subject to Section 7.04, all payments or prepayments of the Loan made by
Borrower shall be applied to pay: first, any costs, expenses and other amounts
not constituting principal or interest which are then due Lender hereunder;
second, any accrued and unpaid interest then payable with respect to the Loan;
and third, the Principal Indebtedness of the Loan.

SECTION 2.07. Taxes.

(a) Within 30 days after paying any amount from which it is required by Law to
make any deduction or withholding, and within 30 days after it is required by
Law to remit such deduction or withholding to any relevant taxing or other
Governmental Authority, Borrower shall deliver to Lender satisfactory evidence
of such deduction, withholding or payment (as the case may be). For the
avoidance of doubt, Borrower shall not be required to pay to Lender any
additional amounts under Section 2.05 due to any deduction or withholding for
U.S. Tax resulting from any U.S. law in effect on the date hereof.

(b) Borrower shall promptly furnish to Lender any such other information as
Lender may from time to time reasonably request in connection with the
transactions contemplated in this Agreement in order for Lender to comply with
its U.S. Tax computational and reporting obligations.

ARTICLE III

ADVANCES

SECTION 3.01. Conditions to Advance. Notwithstanding anything herein to the
contrary, the only conditions to an Advance shall be satisfaction (as determined
by Lender in its reasonable discretion) of the following requirements:

(a) Borrower shall have delivered to Lender, not less than 10 Business Days
prior to the date on which the Advance is requested to be made, a written
Request for Advance with respect thereto, all of which is true, correct and
complete; and

(b) After giving effect to the requested Advance, the Principal Indebtedness
shall not exceed the Loan Amount.

ARTICLE IV

REPRESENTATIONS AND WARRANTIES

 

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Borrower represents to Lender that, as of the Closing Date:

SECTION 4.01. Organization. Borrower is duly organized, validly existing and in
good standing under the laws of the State of Delaware, and is in good standing
in each other jurisdiction where ownership of its properties or the conduct of
its business requires it to be so, and Borrower has all power and authority
under such laws and its organizational documents and all material governmental
licenses, authorizations, consents and approvals required to carry on its
business as now conducted.

SECTION 4.02. Authorization. Borrower has the power and authority to enter into
this Agreement and the other Loan Documents, to perform its obligations
hereunder and thereunder and to consummate the transactions contemplated by the
Loan Documents and has by proper action duly authorized the execution and
delivery of the Loan Documents.

SECTION 4.03. No Conflicts. Neither the execution and delivery of the Loan
Documents, nor the consummation of the transactions contemplated therein (which
for all purposes herein shall include conversion of the Note), nor performance
of and compliance with the terms and provisions thereof will (i) violate or
conflict with any provision of Borrower’s formation and governance documents,
(ii) violate or conflict with contractual provisions of, or cause an event of
default under, any indenture, loan agreement, mortgage, contract or other
material agreement to which Borrower is a party or by which Borrower may be
bound or (iii) result in or require the creation of any Lien or other charge or
encumbrance upon any asset of Borrower.

SECTION 4.04. Enforceable Obligations. This Agreement and the other Loan
Documents have been duly executed and delivered by Borrower and constitute
Borrower’s legal, valid and binding obligations, enforceable against Borrower in
accordance with their respective terms, subject to bankruptcy, insolvency,
fraudulent transfer, reorganization, moratorium and similar Laws of general
applicability relating to or affecting creditors’ rights and to general equity
principles. The Loan Documents are not subject to any right of rescission,
set-off, counterclaim or defense by Borrower, including the defense of usury.

SECTION 4.05. Compliance with Anti-Terrorism, Embargo, Sanctions and Anti-Money
Laundering Laws. (a) None of the funds or other assets of any of Borrower
constitute property of, or are beneficially owned, directly or indirectly, by
any person, entity or government subject to trade restrictions under federal
Law, including the International Emergency Economic Powers Act, 50 U.S.C. §§
1701 et seq., The Trading with the Enemy Act, 50 U.S.C. App. 1 et seq., and any
executive orders or regulations promulgated thereunder, with the result that
(i) the investment in Borrower (whether directly or indirectly), is prohibited
by Law or (ii) the Loan is in violation of Law (any such person, entity or
government, an “Embargoed Person”); (b) no Embargoed Person has any interest of
any nature whatsoever in Borrower (whether directly or indirectly), with the
result that (i) the investment in Borrower (whether directly or indirectly) is
prohibited by Law or (ii) the Loan is in violation of Law, (c) none of the funds
of Borrower have been derived from any unlawful activity with the result that
(i) the investment in Borrower (whether directly or indirectly) is prohibited by
Law or (ii) the Loan is in violation of Law and (d) Borrower and its
subsidiaries are in material compliance with

 

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the PATRIOT Act. Borrower has implemented procedures, and will consistently
apply those procedures throughout the term of the Loan, to ensure the foregoing
representations and warranties remain true and correct during the term of the
Loan. Notwithstanding Section 4.06 to the contrary, the representations and
warranties contained in this Section 4.05 shall survive in perpetuity.

SECTION 4.06. Survival. Borrower agrees that all of the representations of
Borrower set forth in this Agreement and in the other Loan Documents shall
survive for so long as any portion of the Indebtedness is outstanding. All
representations, covenants and agreements made by Borrower in this Agreement or
in the other Loan Documents shall be deemed to have been relied upon by Lender
notwithstanding any investigation heretofore or hereafter made by Lender or on
its behalf.

ARTICLE V

AFFIRMATIVE COVENANTS

SECTION 5.01. Maintenance of Existence. Borrower shall, at all times
(i) preserve, renew and maintain in full force and effect its legal existence
and good standing under the Laws of the jurisdiction of its organization and
(ii) take all reasonable action to maintain all rights, privileges, permits,
licenses and franchises (including all Governmental Authorizations) necessary in
the normal conduct of its business.

SECTION 5.02. Compliance with Laws. Borrower shall comply with all applicable
Laws.

SECTION 5.03. Use of Proceeds. The proceeds received by Borrower in connection
with the Loan shall be used by Borrower solely to pay amounts due and properly
payable under the Bank Loan Agreement and for no other purpose.

ARTICLE VI

SUBORDINATION

SECTION 6.01. Subordination. Anything in this Agreement to the contrary
notwithstanding, the Indebtedness evidenced by this Agreement shall be
subordinate and junior in right of payment in full in cash, to the extent and in
the manner hereinafter set forth, to all indebtedness or other liabilities of
the Borrower outstanding from time to time arising under the Bank Loan Agreement
(as in effect on the date hereof, or as may be modified with the prior written
consent of Lender), including any interest accruing after the commencement of
any proceedings referred to in clause (b) below, whether or not such interest is
an allowed claim in any such proceeding (all such indebtedness or other
liabilities and interest being herein called “Senior Indebtedness”):

(a) the holders of Senior Indebtedness shall be entitled to receive payment in
full in cash of all amounts constituting Senior Indebtedness before the Lender
is entitled to receive any payment on account of this Agreement or the Note and,
in that connection,

 

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unless and until the principal of, and interest on, and all other amounts in
respect of, all Senior Indebtedness shall have been paid full in cash (i) no
payment on account of the principal of, or interest on, or any other amount in
respect of, this Agreement or the Note or any judgment with respect thereto (and
no payment on account of the purchase or redemption or other acquisition of this
Agreement or the Note) shall be made by or on behalf of the Borrower and
(ii) the Lender shall not (x) ask, demand, sue for, take or receive from the
Borrower, by set-off or in any other manner any payment on account of the
principal of, or interest on, or any other amount in respect of, this Agreement
or the Note or (y) seek any other remedy allowed at law or in equity against the
Borrower for breach of the Borrower’s obligations under this Agreement or the
Note; provided, however, that the Borrower may make, and the Lender shall be
entitled to receive and retain from time to time, payments in respect of the
principal of and interest of this Agreement or the Note so long as no Default or
Event of Default under and as defined in the Credit Agreement shall have
occurred and be continuing at the time, or after giving effect to, such payment
or prepayment;

(b) in the event of any insolvency or bankruptcy proceedings, and any
receivership, liquidation, reorganization or other similar proceedings in
connection therewith, relative to the Borrower or to its creditors, as such, or
to its property, and in the event of any proceedings for voluntary liquidation,
dissolution or other winding up of the Borrower, whether or not involving
insolvency or bankruptcy, then the holders of Senior Indebtedness shall be
entitled to receive payment in full in cash of all amounts constituting Senior
Indebtedness before the Lender is entitled to receive, or make any demand for,
any payment on account of this Agreement or the Note, and to that end the
holders of Senior Indebtedness shall be entitled to receive for application in
payment thereof any payment or distribution of any kind or character, whether in
cash or property or securities; and

(c) if any payment or distribution of any character, including by any exercise
of any right of setoff by the Lender, whether in cash, securities or other
property, in respect of this Agreement or the Note shall (despite these
subordination provisions) be received by the Lender before all Senior
Indebtedness shall have been paid in full in cash, such payment or distribution
shall be held in trust for the benefit of, and shall be paid over or delivered
to, the holders of Senior Indebtedness (or their representatives), ratably
according to the respective aggregate amounts remaining unpaid thereon, to the
extent necessary to pay all Senior Indebtedness in full.

No present or future holder of Senior Indebtedness shall be prejudiced in its
right to enforce subordination of this Agreement or the Note by any act or
failure to act on the part of the Borrower or by any act or failure to act, in
good faith on the part of such holder or any trustee or agent for such holder.
The foregoing provisions are solely for the purpose of defining the relative
rights of the holders of Senior Indebtedness on the one hand, and the Lender on
the other hand, and nothing herein shall impair, as between the Borrower and the
Lender, the obligation of the Borrower, which is unconditional and absolute, to
pay to the Lender the principal hereof and interest hereon in accordance with
the terms hereof, nor shall anything herein prevent the Lender from exercising
all remedies otherwise permitted by applicable law in respect hereof, subject to

 

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the rights, if any, under this Agreement and the Note of holders of Senior
Indebtedness to receive cash, property or securities otherwise payable or
deliverable to the Payee. Additionally, without the prior written consent of
Lender, neither the Bank Loan Agreement nor any other document evidencing or
securing the Senior Indebtedness may be amended, modified or supplemented, in
any material respect.

SECTION 6.02. Subrogation. Subject to the payment in full in cash of the Senior
Indebtedness, the Lender shall be subrogated to the rights of the holders of
such Senior Indebtedness to receive payments and distributions of cash, property
and securities applicable to the Senior Indebtedness until the principal of, and
interest on, the Senior Indebtedness shall be paid in full in cash. For purposes
of such subrogation, no payments or distributions to the holders of Senior
Indebtedness of any cash, property or securities to which the Lender would be
entitled except for this Article 6, and no payments pursuant to this Article 6
to the holders of Senior Indebtedness by the Lender, shall, as between the
Borrower, its creditors other than holders of Senior Indebtedness, and the
Lender, be deemed to be a payment or distribution by the Borrower to or on
account of the Senior Indebtedness.

SECTION 6.03. No Petition. So long as any Senior Indebtedness is outstanding,
the Lender, in its capacity as a creditor of Borrower, shall not commence, or
join with any creditor (other than any Person to whom Senior Indebtedness is
owed) in commencing, or directly or indirectly cause the Borrower to commence,
or assist the Borrower in commencing, any insolvency or bankruptcy proceedings,
or any receivership, liquidation, reorganization or other similar proceedings in
connection therewith, relative to the Borrower or to its creditors, as such, or
to its property; provided, however, that nothing herein shall prohibit or
otherwise limit a member of the Borrower’s board of directors from exercising
his or her fiduciary duties or other obligations under applicable law.

ARTICLE VII

EVENTS OF DEFAULT

SECTION 7.01. Event of Default. The occurrence of any one or more of the
following events shall be, and shall constitute the commencement of, an “Event
of Default” hereunder (any Event of Default that has occurred shall continue
unless and until waived by Lender in writing in its sole discretion) and Lender
shall be entitled to the remedies set forth in Section 7.02:

(a) Payment.

(i) Borrower shall default in the payment when due of any principal or interest
owing hereunder or under the Note (including any mandatory prepayment required
hereunder); or

 

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(ii) Borrower shall default, and such default shall continue for at least 5
Business Days after written notice to Borrower that such amounts are owing, in
the payment when due of fees, expenses or other amounts owing hereunder, under
the Note or under any of the other Loan Documents (other than principal and
interest owing hereunder or under the Note).

(b) Other Loan Documents. Any Loan Document shall fail to be in full force and
effect or to convey the material rights, powers and privileges purported to be
created thereby; or a default shall occur under any of the other Loan Documents,
in each case, beyond the expiration of any applicable cure period, which default
shall have a Material Adverse Effect.

(c) Bankruptcy, Etc.

(i) Borrower shall commence a voluntary case concerning itself under Title 11 of
the United States Code (as amended, modified, succeeded or replaced, from time
to time, the “Bankruptcy Code”);

(ii) Borrower shall commence any other proceeding under any reorganization,
arrangement, adjustment of debt, relief of creditors, dissolution, insolvency or
similar Law of any jurisdiction whether now or hereafter in effect relating to
Borrower, or shall dissolve or otherwise cease to exist;

(iii) there is commenced against Borrower an involuntary case under the
Bankruptcy Code, or any such other proceeding, which remains undismissed for a
period of thirty (30) days after commencement;

(iv) Borrower is adjudicated insolvent or bankrupt;

(v) Borrower suffers appointment of any custodian or the like for it or for any
substantial portion of its property and such appointment continues unchanged or
unstayed for a period of thirty (30) days after commencement of such
appointment;

(vi) Borrower makes a general assignment for the benefit of creditors; or;

(vii) any action is taken by Borrower for the purpose of effecting any of the
foregoing.

(d) Other Covenants. A default shall occur in the due performance or observance
by Borrower of any term, covenant or agreement (other than those referred to in
any other subsection of this Section 7.1) contained in this Agreement or in any
of the other Loan Documents, except that in the case of a default that can be
cured by the payment of money, such default shall not constitute an Event of
Default unless and until it shall remain uncured for 15 days after Borrower
receives written notice thereof; and in the case of a default that cannot be
cured by the payment of money but is susceptible of being cured within 30 days,
such default

 

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shall not constitute an Event of Default unless and until it remains uncured for
30 days after Borrower receives written notice thereof, provided that within 5
days of its receipt of such written notice, Borrower delivers written notice to
Lender of its intention and ability to effect such cure within such 30 day
period; and if such non-monetary default is not cured within such 30 day period
despite Borrower’s diligent efforts but is susceptible of being cured within 60
days of Borrower’s receipt of Lender’s original notice, then Borrower shall have
such additional time as is reasonably necessary to effect such cure, but in no
event in excess of 60 days from Borrower’s receipt of Lender’s original notice,
provided that prior to the expiration of the initial 30 day period, Borrower
delivers written notice to Lender of its intention and ability to effect such
cure prior to the expiration of such 60 day period.

SECTION 7.02. Remedies.

(a) During the continuance of an Event of Default, Lender may by written notice
to Borrower, in addition to any other rights or remedies available pursuant to
this Agreement, the Note and the other Loan Documents, at Law or in equity,
declare by written notice to Borrower all or any portion of the Indebtedness to
be immediately due and payable, whereupon all or such portion of the
Indebtedness shall so become due and payable, and Lender may enforce or avail
itself of any or all rights or remedies provided in the Loan Documents against
Borrower (including all rights or remedies available at Law or in equity);
provided, however, that, notwithstanding the foregoing, if an Event of Default
specified in Section 7.01(d) shall occur, then the Indebtedness shall
immediately become due and payable without the giving of any notice or other
action by Lender. Any actions taken by Lender shall be cumulative and concurrent
and may be pursued independently, singly, successively, together or otherwise,
at such time and in such order as Lender may determine in its sole discretion,
to the fullest extent permitted by Law, without impairing or otherwise affecting
the other rights and remedies of Lender permitted by Law, equity or contract or
as set forth in this Agreement or in the other Loan Documents.

(b) During the continuance of any Event of Default, Lender may, but without any
obligation to do so and without notice to or demand on Borrower and without
releasing Borrower from any obligation hereunder, take any action to cure such
Event of Default. The costs and expenses incurred by Lender in exercising rights
under this Section (including reasonable attorneys’ fees), with interest at the
Default Rate for the period after notice from Lender that such costs or expenses
were incurred to the date of payment to Lender, shall constitute a portion of
the Indebtedness and shall be due and payable to Lender upon demand therefor.

(c) Interest shall accrue on any judgment obtained by Lender in connection with
its enforcement of the Loan at a rate of interest equal to the Default Rate.

SECTION 7.03. No Waiver. No delay or omission to exercise any remedy, right or
power accruing upon an Event of Default shall impair any such remedy, right or

 

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power or shall be construed as a waiver thereof, but any such remedy, right or
power may be exercised from time to time and as often as may be deemed by Lender
to be expedient. A waiver of any Default or Event of Default shall not be
construed to be a waiver of any subsequent Default or Event of Default or to
impair any remedy, right or power consequent thereon.

SECTION 7.04. Application of Payments after an Event of Default. Notwithstanding
anything to the contrary contained herein, during the continuance of an Event of
Default, all amounts received by Lender in respect of the Loan shall be applied
at Lender’s sole discretion toward the components of the Indebtedness (e.g.,
Lender’s expenses in enforcing the Loan, interest, principal and other amounts
payable hereunder) and the Note in such sequence as Lender shall elect in its
sole discretion; provided, that if an Event of Default specified in
Section 7.01(a) shall occur, then Lender shall apply all amounts received by
Lender in respect of the Loan towards the component of the Indebtedness for
which Borrower’s failure to pay has resulted in the occurrence of such Event of
Default.

ARTICLE VIII

MISCELLANEOUS

SECTION 8.01. Successors. Except as otherwise provided in this Agreement,
whenever in this Agreement any of the parties to this Agreement is referred to,
such reference shall be deemed to include the successors and permitted assigns
of such party. All covenants, promises and agreements in this Agreement
contained, by or on behalf of Borrower, shall inure to the benefit of Lender and
its successors and assigns.

SECTION 8.02. Governing Law.

(a) THIS AGREEMENT WAS NEGOTIATED IN THE STATE OF NEW YORK, THE NOTE WAS MADE BY
BORROWER IN THE STATE OF NEW YORK, AND THE PROCEEDS OF THE LOAN SHALL BE
DISBURSED FROM THE STATE OF NEW YORK, WHICH STATE THE PARTIES AGREE HAS A
SUBSTANTIAL RELATIONSHIP TO THE PARTIES AND TO THE UNDERLYING TRANSACTIONS
EMBODIED HEREBY, AND IN ALL RESPECTS, INCLUDING, WITHOUT LIMITING THE GENERALITY
FOREGOING, MATTERS OF CONSTRUCTION, VALIDITY AND PERFORMANCE, THIS AGREEMENT,
THE NOTE AND THE OTHER LOAN DOCUMENTS AND THE OBLIGATIONS ARISING THEREUNDER AND
HEREUNDER SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF
THE STATE OF NEW YORK WITHOUT REGARD TO CHOICE OF LAW RULES TO THE EXTENT THE
APPLICATION OF THE LAWS OF ANOTHER JURISDICTION WOULD BE REQUIRED THEREBY.

(b) ANY LEGAL SUIT, ACTION OR PROCEEDING AGAINST EITHER PARTY ARISING OUT OF OR
RELATING TO THIS AGREEMENT, THE NOTE OR ANY OF THE OTHER LOAN DOCUMENTS SHALL BE
INSTITUTED IN ANY FEDERAL OR STATE COURT IN NEW YORK, NEW YORK. BORROWER HEREBY
(i) IRREVOCABLY WAIVES, TO THE

 

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FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY OBJECTION WHICH IT MAY NOW OR
HEREAFTER HAVE TO THE LAYING OF VENUE OF ANY SUCH SUIT, ACTION OR PROCEEDING
BROUGHT IN SUCH A COURT AND ANY CLAIM THAT ANY SUCH PROCEEDING BROUGHT IN SUCH A
COURT HAS BEEN BROUGHT IN AN INCONVENIENT FORUM, (ii) IRREVOCABLY SUBMITS TO THE
JURISDICTION OF ANY SUCH COURT IN ANY SUCH SUIT, ACTION OR PROCEEDING AND
(iii) IRREVOCABLY CONSENTS TO SERVICE OF PROCESS BY MAIL, PERSONAL SERVICE OR IN
ANY OTHER MANNER PERMITTED BY APPLICABLE LAW, AT THE ADDRESS SPECIFIED IN
SECTION 8.04 (AND AGREES THAT SUCH SERVICE AT SUCH ADDRESS IS SUFFICIENT TO
CONFER PERSONAL JURISDICTION OVER ITSELF IN ANY SUCH SUIT, ACTION OR PROCEEDING
IN ANY SUCH COURT, AND OTHERWISE CONSTITUTES EFFECTIVE AND BINDING SERVICE IN
EVERY RESPECT).

(c) ALL COMMUNICATIONS UNDER AND PURSUANT TO THIS AGREEMENT SHALL BE IN THE
ENGLISH LANGUAGE.

SECTION 8.03. Modification; Waiver in Writing. Neither this Agreement nor any
other Loan Document nor any of the terms hereof or thereof may be amended,
changed, waived, discharged or terminated, nor shall any consent or approval of
Lender be granted hereunder, unless such amendment, change, waiver, discharge,
termination, consent or approval is in writing signed by Lender.

SECTION 8.04. Notices. All notices, consents, approvals, reports, designations,
requests, waivers, elections and other communications (collectively, “Notices”)
authorized or required to be given pursuant to this Agreement shall be given in
writing and either personally delivered to the Party to whom it is given or
delivered by an established delivery service by which receipts are given or
mailed by registered or certified mail, postage prepaid, or sent by facsimile or
electronic mail with a copy sent on the following Business Day by one of the
other methods of giving notice described herein, addressed to the Party at its
address listed below. A Notice shall be deemed to have been given when delivered
or upon refusal to accept delivery.

If to Borrower:

Empire Resorts, Inc.

c/o Monticello Raceway

Route 17B

P.O. Box 5013

Monticello, New York 12701

Attention: Nanette Horner

Telephone Number: (845) 794-4100, ext. 574

Facsimile Number: (845) 807-0000

 

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with a copy to:

Paul, Weiss, Rifkind, Wharton & Garrison LLP

1285 Avenue of the Americas

New York, NY 10019-6064

Attention: Harris Freidus

Telephone Number: (212) 373-3064

Facsimile Number: (212) 492-0064

If to Lender:

Kien Huat Realty III Limited

c/o 21st Floor Wisma Genting

Jalan Sultan Ismail

Kuala Lumpur

Malaysia

Attention: Gerard Lim

Telephone Number: + 603 2333 6820

Facsimile Number: +603 2162 4951

with a copy to:

Cleary Gottlieb Steen & Hamilton LLP

One Liberty Plaza

New York, New York 10006

Attention: Steven L. Wilner, Esq.

Telephone Number: (212) 225-2672

Facsimile Number: (212) 225-3999

Either Party may change its address for the receipt of Notices at any time by
giving Notice thereof to the other Party.

SECTION 8.05. TRIAL BY JURY.

LENDER AND BORROWER, TO THE FULLEST EXTENT THAT THEY MAY LAWFULLY DO SO, HEREBY
AGREE NOT TO ELECT A TRIAL BY JURY OF ANY ISSUE TRIABLE OF RIGHT BY JURY, AND
WAIVE ANY RIGHT TO TRIAL BY JURY FULLY TO THE EXTENT THAT ANY SUCH RIGHT SHALL
NOW OR HEREAFTER EXIST WITH REGARD TO THE LOAN DOCUMENTS, OR ANY CLAIM,
COUNTERCLAIM OR OTHER ACTION ARISING IN CONNECTION THEREWITH. THIS WAIVER OF
RIGHT TO TRIAL BY JURY IS GIVEN KNOWINGLY AND VOLUNTARILY BY LENDER AND BORROWER
AND IS INTENDED TO ENCOMPASS INDIVIDUALLY EACH INSTANCE AND EACH ISSUE AS TO
WHICH THE RIGHT TO A TRIAL BY JURY WOULD OTHERWISE ACCRUE. LENDER AND BORROWER
ARE HEREBY AUTHORIZED TO FILE A COPY OF THIS SECTION IN ANY PROCEEDING AS
CONCLUSIVE EVIDENCE OF THIS WAIVER BY BORROWER.

 

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SECTION 8.06. Headings. The Article and Section headings in this Agreement are
included herein for convenience of reference only and shall not constitute a
part of this Agreement for any other purpose.

SECTION 8.07. No Assignment. Neither Lender nor Borrower may sell, assign or
transfer any interest in the Loan Documents or any portion thereof (including
either Party’s respective rights, title, interests, remedies, powers and duties
hereunder and thereunder).

SECTION 8.08. Expenses. Borrower shall reimburse Lender upon receipt of written
notice from Lender for (i) all documented and reasonable out-of-pocket costs and
expenses incurred by Lender (or any of its Affiliates) in connection with the
origination of the Loan, including reasonable legal fees and disbursements,
accounting fees and any other third-party diligence materials; (ii) all
documented and reasonable out-of-pocket costs and expenses incurred by Lender
(or any of its Affiliates) in connection with (A) the negotiation, preparation,
execution, delivery and administration of any consents, amendments, waivers or
other modifications to this Agreement and the other Loan Documents and any other
documents or matters requested by Borrower or by Lender and (B) enforcing or
preserving any rights, in response to third party claims or the prosecuting or
defending of any action or proceeding or other litigation, in each case against,
under or affecting Borrower, this Agreement, or the other Loan Documents; and
(iii) all documented and reasonable out-of-pocket costs and expenses (including
attorney’s fees) incurred by Lender (or any of its Affiliates) in connection
with the enforcement of any obligations of Borrower, or a Default by Borrower,
under the Loan Documents, including any refinancing, restructuring, settlement
or workout and any insolvency or bankruptcy proceedings (including any
applicable transfer taxes).

SECTION 8.09. Severability. Wherever possible, each provision of this Agreement
shall be interpreted in such manner as to be effective and valid under
applicable Law, but if any provision of this Agreement shall be prohibited by or
invalid under applicable Law, such provision shall be ineffective to the extent
of such prohibition or invalidity, without invalidating the remainder of such
provision or the remaining provisions of this Agreement.

SECTION 8.10. Preferences. Lender shall have no obligation to marshal any assets
in favor of Borrower or any other party or against or in payment of any or all
of the obligations of Borrower pursuant to this Agreement, the Note or any other
Loan Document. Lender shall have the continuing and exclusive right to apply or
reverse and reapply any and all payments by Borrower to any portion of the
obligations of Borrower hereunder and under the Loan Documents. To the extent
Borrower makes a payment or payments to Lender, which payment or proceeds or any
portion thereof are subsequently invalidated, declared to be fraudulent or
preferential, set aside or required to be repaid to a trustee, receiver or any
other party under any bankruptcy Law, state or federal Law, common Law or
equitable cause, then, to the extent of such payment or proceeds received, the
obligations hereunder or portion thereof intended to be satisfied shall be
revived and continue in full force and effect, as if such payment or proceeds
had not been received by Lender.

 

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SECTION 8.11. Remedies of Borrower. In the event that a claim or adjudication is
made that Lender or its agents have unreasonably delayed acting in any case
where by Law or under this Agreement or the other Loan Documents, any of such
Persons has an obligation to act promptly, Borrower agrees that no such Person
shall be liable for any monetary damages, and Borrower’s sole remedies shall be
limited to commencing an action seeking specific performance, injunctive relief
and/or declaratory judgment. Without in any way limiting the foregoing, Borrower
shall not assert, and hereby waives, any claim against Lender and/or its
affiliates, directors, employees, attorneys, agents or sub-agents, on any theory
of liability, for direct, special, indirect, consequential or punitive damages
(whether or not the claim therefor is based on contract, tort or duty imposed by
any applicable legal requirement) arising out of, as a result of, or in any way
related to, this Agreement or any other Loan Document or any agreement or
instrument contemplated hereby or thereby or referred to herein or therein, the
transactions contemplated hereby or thereby, the Loan or the use of the proceeds
thereof or any act or omission or event occurring in connection therewith, and
Borrower hereby waives, releases and agrees not to sue upon any such claim for
any such damages, whether or not accrued and whether or not known or suspected
to exist in its favor.

SECTION 8.12. Offsets, Counterclaims and Defenses. All payments made by Borrower
hereunder or under the other Loan Documents shall be made irrespective of, and
without any deduction for, any setoffs or counterclaims. Borrower waives the
right to assert a counterclaim, other than a mandatory or compulsory
counterclaim, in any action or proceeding brought against it by Lender arising
out of or in any way connected with the Note, this Agreement, the other Loan
Documents or the Indebtedness. Any assignee of Lender’s interest in the Loan
shall take the same free and clear of all offsets, counterclaims or defenses
that are unrelated to the Loan.

SECTION 8.13. No Joint Venture. Nothing in this Agreement is intended to create
a joint venture or partnership between Borrower and Lender.

SECTION 8.14. Conflict; Construction of Documents. In the event of any conflict
between the provisions of this Agreement and the provisions of the Note or any
of the other Loan Documents, the provisions of this Agreement shall prevail.

SECTION 8.15. Brokers and Financial Advisors. Borrower hereby represents that it
has dealt with no financial advisors, brokers, underwriters, placement agents,
agents or finders in connection with the transactions contemplated by this
Agreement. Borrower hereby agrees to indemnify, defend and hold Lender harmless
from and against any and all claims, liabilities, costs and expenses of any kind
(including attorneys’ fees and expenses) in any way relating to or arising from
a claim by any Person that such Person acted on behalf of Borrower or Lender in
connection with the transactions contemplated herein. The provisions of this
Section 8.15 shall survive the expiration and termination of this Agreement and
the repayment of the Indebtedness.

SECTION 8.16. Counterparts. This Agreement may be executed in any number of
counterparts, each of which when so executed and delivered shall be an original,
but all of which shall together constitute one and the same instrument. Any
counterpart delivered by facsimile, pdf or other electronic means shall have the
same import and effect as original counterparts and shall be valid, enforceable
and binding for the purposes of this Agreement.

 

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SECTION 8.17. Register. Lender, as non-fiduciary agent of Borrower, shall
maintain a record that identifies each owner (including successors and
assignees) of an interest in the Loan, including the name and address of the
owner, and each owner’s rights to principal and stated interest (the
“Register”), and shall record all transfers of an interest in the Loan,
including each assignment, in the Register. The entries in the Register shall be
conclusive absent manifest error. The Borrower and Lender shall treat each
Person whose name is recorded in the Register pursuant to the terms hereof as a
Lender hereunder for all purposes of this Agreement. Failure to make any such
recordation, or any error in such recordation, however, shall not affect
Borrower’s obligations in respect of the Loan. Borrower and Lender acknowledge
that the Note is in registered form and may not be transferred except by
register.

SECTION 8.18. General Indemnity.

(a) Borrower, at its sole cost and expense, shall protect, indemnify, reimburse,
defend and hold harmless Lender and its officers, partners, members, directors,
trustees, advisors, employees, agents, sub-agents, affiliates, successors,
participants and assigns of any and all of the foregoing (collectively, the
“Indemnified Parties”) for, from and against, and shall be responsible for, any
and all Damages of any kind or nature whatsoever that may be imposed on,
incurred by, or asserted against any of the Indemnified Parties, in any way
relating to or arising out of (i) any negligence or tortious act or omission on
the part of Borrower or any of its agents, contractors, servants or employees;
(ii) any failure on the part of Borrower to perform or comply with any of the
terms of the Loan Documents; and (iii) any failure of Borrower to comply with
any Laws; provided, however, that no Indemnified Party shall have the right to
be indemnified hereunder to the extent that such Damages have been found by a
final, non-appealable judgment of a court of competent jurisdiction to have
resulted from the gross negligence or willful misconduct of such Indemnified
Party.

(b) If for any reason (including violation of Law or public policy) the
undertakings to defend, indemnify, pay and hold harmless set forth in this
Section 8.18 are unenforceable in whole or in part or are otherwise unavailable
to Lender or insufficient to hold it harmless, then Borrower shall contribute to
the amount paid or payable by Lender as a result of any Damages the maximum
amount Borrower is permitted to pay under Law. The obligations of Borrower under
this Section 8.18 will be in addition to any liability that Borrower may
otherwise have hereunder and under the other Loan Documents, will extend upon
the same terms and conditions to any Affiliate of Lender and the partners,
members, directors, agents, employees and controlling persons (if any), as the
case may be, of Lender and any such Affiliate, and will be binding upon and
inure to the benefit of any successors, assigns, heirs and personal
representatives of Borrower, Lender, any such Affiliate and any such Person.

(c) At the option of the Indemnified Parties and in their sole discretion, upon
written request by any Indemnified Party, Borrower shall defend such Indemnified
Party (if requested by any Indemnified Party, in the name of the Indemnified
Party) by attorneys and other professionals reasonably approved by such
Indemnified Party. Notwithstanding the foregoing, any Indemnified Party may
engage its own attorneys and other professionals to defend or assist it

 

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(chosen at Lender’s sole discretion), and, at the option of such Indemnified
Party, its attorneys shall control the resolution of any claim or proceeding.
Upon demand, Borrower shall pay or, in the sole discretion of the Indemnified
Parties, reimburse, the Indemnified Parties for the payment of reasonable fees
and disbursements of attorneys, engineers, environmental consultants,
laboratories and other professionals in connection therewith.

(d) Any amounts payable to Lender by reason of the application of this
Section 8.18 shall become immediately due and payable and shall bear interest at
the Default Rate from the date Damages are sustained by the Indemnified Parties
until paid.

(e) The provisions of and undertakings and indemnification set forth in this
Section 8.18 shall survive the satisfaction and payment in full of the
Indebtedness and termination of this Agreement.

SECTION 8.19. Third-Party Beneficiaries. This Agreement and the other Loan
Documents are solely for the benefit of Lender and Borrower, and nothing
contained in this Agreement or the other Loan Documents shall be deemed to
confer upon anyone other than Lender, Borrower and Indemnified Parties any right
to insist upon or to enforce the performance or observance of any of the
obligations contained herein or therein; provided, however that the Bank Lender
shall be an express third party beneficiary of all of the agreements,
undertakings and obligations of the Lender under Section 2.01 and Section 6 of
this Agreement as if the Bank Lender was a party thereto, and in connection
herewith, the Bank Lender shall have the direct right to enforce any of the
rights and benefits of the Borrower under Section 2.01 of this Agreement. All
conditions to the obligations of Lender to make the Loan hereunder are imposed
solely and exclusively for the benefit of Lender, and no other Person shall have
standing to require satisfaction of such conditions in accordance with their
terms or be entitled to assume that Lender will refuse to make the Loan in the
absence of strict compliance with any or all thereof, and no other Person shall
under any circumstances be deemed to be a beneficiary of such conditions, any or
all of which may be freely waived in whole or in part by Lender if, in Lender’s
sole discretion, Lender deems it advisable or desirable to do so.

SECTION 8.20. Right of Set-Off. In addition to any rights now or hereafter
granted under applicable Law or otherwise, and not by way of limitation of any
such rights, during the continuance of an Event of Default, Lender may from time
to time, without presentment, demand, protest or other notice of any kind (all
of such rights being hereby expressly waived), set-off and appropriate and apply
any and all deposits (general or special) and any other indebtedness at any time
held or owing by Lender (including branches, agencies or Affiliates of Lender
wherever located) to or for the credit or the account of Borrower against the
obligations and liabilities of Borrower to Lender hereunder, under the Note, the
other Loan Documents or otherwise, irrespective of whether Lender shall have
made any demand hereunder and although such obligations, liabilities or claims,
or any of them, may be contingent or unmatured, and any such set-off shall be
deemed to have been made immediately upon the occurrence of an Event of Default
even though such charge is made or entered on the books of Lender subsequent
thereto.

SECTION 8.21. Exculpation of Lender. Lender neither undertakes nor assumes any
responsibility or duty to Borrower or any other Person to select, review,
inspect,

 

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examine, supervise, pass judgment upon or inform Borrower or any other Person of
any due diligence conducted by Lender. Any such due diligence, selection,
review, inspection, examination and the like, and any other due diligence
conducted by Lender, is solely for the purpose of protecting Lender’s rights
under the Loan Documents, and shall not render Lender liable to Borrower or any
other Person for the existence, sufficiency, accuracy, completeness or legality
thereof. The Indemnified Parties shall not be responsible or liable for any
Damages of any kind or nature whatsoever that may be imposed on, incurred by, or
asserted against any of the Indemnified Parties, in any way relating to or
arising out of Lender’s interest in the Loan.

SECTION 8.22. No Fiduciary Duty.

(a) Borrower acknowledges that, in connection with this Agreement, the other
Loan Documents and the Transaction, Lender has relied upon and assumed the
accuracy and completeness of all of the financial, legal, regulatory,
accounting, tax and other information provided to, discussed with or reviewed by
Lender for such purposes, and Lender does not assume any liability therefor or
responsibility for the accuracy, completeness or independent verification
thereof. Lender, its Affiliates and their respective stockholders and employees
(for purposes of this Section, the “Lending Parties”) have no obligation to
conduct any independent evaluation or appraisal of the assets or liabilities
(including any contingent, derivative or off-balance sheet assets and
liabilities) of Borrower or any other Person or any of their respective
Affiliates or to advise or opine on any related solvency or viability issues.

(b) It is understood and agreed that (i) the Lending Parties shall act under
this Agreement and the other Loan Documents as an independent contractor,
(ii) the Transaction is an arm’s-length commercial transactions between the
Lending Parties, on the one hand, and Borrower, on the other, (iii) each Lending
Party is acting solely as principal and not as the agent or fiduciary of
Borrower or their respective Affiliates, stockholders, employees or creditors or
any other Person and (iv) nothing in this Agreement, the other Loan Documents,
the Transaction or otherwise shall be deemed to create (i) a fiduciary duty (or
other implied duty) on the party of any Lending Party to Borrower, any of their
respective Affiliates, stockholders, employees or creditors, or any other Person
or (ii) a fiduciary or agency relationship between Borrower or any of their
respective Affiliates, stockholders, employees or creditors, on the one hand,
and the Lending Parties, on the other. Borrower agrees that neither it nor any
of its respective Affiliates shall make, and hereby waives, any claim against
the Lending Parties based on an assertion that any Lending Party has rendered
advisory services of any nature or respect, or owes a fiduciary or similar duty
to Borrower or its respective Affiliates, stockholders, employees or creditors.
Nothing in this Agreement or the other Loan Documents is intended to confer upon
any other Person (including Affiliates, stockholders, employees or creditors of
Borrower) any rights or remedies by reason of any fiduciary or similar duty.

(c) Borrower acknowledges and agrees that Borrower has consulted its own legal
and financial advisors to the extent it deemed appropriate and that it is
responsible for making its own independent judgment with respect to this
Agreement, the other Loan Documents, the Transaction and the process leading
thereto.

 

21

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SECTION 8.23. PATRIOT Act Records. Lender hereby notifies Borrower that pursuant
to the requirements of the PATRIOT Act, it is required to obtain, verify and
record information that identifies Borrower, which information includes the name
and address of Borrower and other information that will allow Lender to identify
Borrower in accordance with the PATRIOT Act.

SECTION 8.24. Prior Agreements. THIS AGREEMENT AND THE OTHER LOAN DOCUMENTS
CONTAIN THE ENTIRE AGREEMENT OF THE PARTIES HERETO AND THERETO IN RESPECT OF THE
TRANSACTIONS CONTEMPLATED HEREBY AND THEREBY, AND ALL PRIOR AGREEMENTS AMONG OR
BETWEEN SUCH PARTIES IN RESPECT OF THE TRANSACTIONS CONTEMPLATED HEREBY, WHETHER
ORAL OR WRITTEN, INCLUDING ANY TERM SHEETS, CONFIDENTIALITY AGREEMENTS AND
COMMITMENT LETTERS, ARE SUPERSEDED BY THE TERMS OF THIS AGREEMENT AND THE OTHER
LOAN DOCUMENTS.

SECTION 8.25. Delay Not a Waiver. Neither any failure nor any delay on the part
of Lender in insisting upon strict performance of any term, condition, covenant
or agreement, or exercising any right, power, remedy or privilege hereunder, or
under the Note or under any other Loan Document, or under any other instrument
given as security therefor, shall operate as or constitute a waiver thereof, nor
shall a single or partial exercise thereof preclude any other future exercise,
or the exercise of any other right, power, remedy or privilege. In particular,
and not by way of limitation, by accepting payment after the due date of any
amount payable under this Agreement, the Note or any other Loan Document, Lender
shall not be deemed to have waived any right either to require prompt payment
when due of all other amounts due under this Agreement, the Note or the other
Loan Documents, or to declare a default for failure to effect prompt payment of
any such other amount.

SECTION 8.26. Determinations. Each determination or calculation by Lender
hereunder shall, in the absence of manifest error, be conclusive and binding on
the Parties.

[SIGNATURE PAGE FOLLOWS]

 

22

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IN WITNESS WHEREOF, the Parties hereto have caused this Agreement to be duly
executed by their duly authorized representatives, all as of the day and year
first above written.

LENDER:

 

  By:  

 KIEN HUAT REALTY III LIMITED,

a corporation organized in the Isle of Man

    By:  

 /s/ Gerard Lim Ewe Keng

     

Name: Gerard Lim Ewe Keng

Title:   Authorized Signatory

BORROWER:

 

  By:  

 EMPIRE RESORTS, INC.

a Delaware corporation

    By:  

 /s/ Ryan Eller

     

Name: Ryan Eller

Title:   President and Chief Executive Officer

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Exhibit A

Form of Request for Advance

Reference is made to that certain Loan Agreement dated as of December 28, 2017
(as the same may be amended, restated, supplemented or modified from time to
time, the “Loan Agreement”) between Kien Huat Realty III Limited (“Lender”), and
Empire Resorts, Inc. (“Borrower”). Terms not defined in this Request for Advance
shall have the same meaning as in the Loan Agreement.

Borrower hereby represents, warrants and agrees as follows:

 

1. Borrower hereby requests funds in the sum of $________________, which
represents amounts due by Borrower under the Bank Loan in accordance with the
terms and conditions of the Loan Agreement and other Loan Documents, or approved
by Lender.

 

2. All sums disbursed by Lender will be used solely for the purpose of paying
the obligations owing by Borrower and in accordance with the Bank Loan
Agreement.

 

3. Borrower understands that this Request for Advance is delivered for the
purpose of inducing Lender to make a disbursement to Borrower, and that in
making any such disbursement Lender will rely upon the accuracy of the matters
set forth herein.

 

4. [Borrower has insufficient other funds available to pay the amounts due under
the Bank Loan Agreement that are the subject of this Request for Advance.]1

 

5. The proceeds of the Advance being requested hereby should be sent to:

[Account Name: __________

Account Number: _________

ABA Number: __________]2

[Remainder of Page Intentionally Left Blank; Signatures on Subsequent Page]

 

 

1  To be deleted for any Request for Advance delivered by Bank Lender pursuant
to Section 8.19.

2  To be bank account information of the Bank Lender.

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IN WITNESS WHEREOF, Borrower has duly executed this Request for Advance this ___
day of ________, 201_.

BORROWER: