Document:

sec document

                                                                   EXHIBIT 10.17

                          REGISTRATION RIGHTS AGREEMENT

                              EMPIRE RESORTS, INC.

                          REGISTRATION RIGHTS AGREEMENT

            This  Registration  Rights Agreement (this  "AGREEMENT") is made and
entered  into as of January 26,  2004,  by and among  Empire  Resorts,  Inc.,  a
Delaware corporation (the "COMPANY"), and the investors signatory hereto (each a
"PURCHASER" and collectively, the "PURCHASERS").

            This  Agreement  is  made  pursuant  to  the   Securities   Purchase
Agreement,  dated as of the date  hereof,  among the Company and the  Purchasers
(the "PURCHASE AGREEMENT").

            The Company and the Purchasers hereby agree as follows:

            1.  DEFINITIONS.  Capitalized  terms used and not otherwise  defined
herein that are defined in the Purchase  Agreement shall have the meanings given
such terms in the Purchase Agreement.  As used in this Agreement,  the following
terms shall have the respective meanings set forth in this Section 1:

                "EFFECTIVE DATE" means the date that the Registration  Statement
filed pursuant to Section 2(a) is first declared effective by the Commission.

                "EFFECTIVENESS DATE" means the earlier of (a) the 120th calendar
day  following the Closing Date and (b) the fifth Trading Day following the date
on which  the  Company  is  notified  by the  Commission  that the  Registration
Statement  will not be  reviewed or is no longer  subject to further  review and
comments.

                "EFFECTIVENESS  PERIOD"  shall  have the  meaning  set  forth in
Section 2(a).

                "EXCHANGE  ACT" means the  Securities  Exchange Act of 1934,  as
amended.

                "FILING  DATE" means the 60th calendar day following the Closing
Date.

                "HOLDER" or "HOLDERS"  means the holder or holders,  as the case
may be,  from  time  to time of  Registrable  Securities  who has  awarded  such
Registrable  Securities from a Purchaser or a permitted successor or assignee of
such Purchaser pursuant to Section 5.5 of the Securities Purchase Agreement.

                "INDEMNIFIED  PARTY" shall have the meaning set forth in Section
6(c).

                "INDEMNIFYING PARTY" shall have the meaning set forth in Section
6(c).

                "LOSSES" shall have the meaning set forth in Section 6(a).

                "PROCEEDING" means an action, demand, claim,  litigation,  suit,
investigation,  arbitration  or proceeding  (including,  without  limitation,  a
partial proceeding, such as a deposition), whether pending or threatened.

                "PROSPECTUS"  means the  prospectus  included in a  Registration
Statement  (including,  without  limitation,  a  prospectus  that  includes  any
information  previously  omitted from a prospectus filed as part of an effective
registration  statement  in  reliance  upon  Rule  430A  promulgated  under  the
Securities Act), as amended or supplemented by any prospectus  supplement,  with
respect  to  the  terms  of  the  offering  of any  portion  of the  Registrable
Securities covered by the Registration  Statement,  and all other amendments and
supplements to the  Prospectus,  including  post-effective  amendments,  and all
material  incorporated by reference or deemed to be incorporated by reference in
such Prospectus.

                "REGISTRABLE SECURITIES" means all of the Shares.

                "REGISTRATION  STATEMENT"  means the  registration  statement or
statements  required  to be  filed  hereunder,  including  (in  each  case)  the
Prospectus,  amendments  and  supplements  to  such  registration  statement  or
Prospectus,  including pre- and post-effective amendments, all exhibits thereto,
and all  material  incorporated  by reference  or deemed to be  incorporated  by
reference in such registration statement.

                "RULE 144" means Rule 144 promulgated by the Commission pursuant
to the  Securities  Act, as such Rule may be amended  from time to time,  or any
similar  rule  or  regulation   hereafter   adopted  by  the  Commission  having
substantially the same effect as such Rule.

                "RULE 415" means Rule 415 promulgated by the Commission pursuant
to the  Securities  Act, as such Rule may be amended  from time to time,  or any
similar  rule  or  regulation   hereafter   adopted  by  the  Commission  having
substantially the same effect as such Rule.

                "RULE 424" means Rule 424 promulgated by the Commission pursuant
to the  Securities  Act, as such Rule may be amended  from time to time,  or any
similar  rule  or  regulation   hereafter   adopted  by  the  Commission  having
substantially the same effect as such Rule.

                "SECURITIES ACT" means the Securities Act of 1933, as amended.

                "SHARES"  means  the  shares  of  Common  Stock  issued  to  the
Purchasers pursuant to the Purchase Agreement.

                "SPECIAL  COUNSEL" means the counsel  selected to act as special
counsel hereunder by Purchasers  representing at least 66.67% in interest of all
Purchasers,  the name and contact  information of which has been provided to the
Company.

                "TRADING  DAY"  means  (i) a day on which the  Company's  common
stock is traded on a Trading  Market,  or (ii) if the common stock is not listed
on a  Trading  Market,  a day  on  which  the  common  stock  is  traded  on the
over-the-counter  market, as reported by the OTC Bulletin Board, or (iii) if the
common stock is not quoted on the OTC Bulletin  Board, a day on which the Common
Stock is  quoted in the  over-the-counter  market as  reported  by the  National
Quotation Bureau Incorporated (or any similar  organization or agency succeeding
its functions of reporting prices);  provided, that in the event that the common
stock is not listed or quoted as set forth in (i), (ii) and (iii)  hereof,  then
Trading Day shall mean a Business Day (as defined in the Purchase Agreement).

                                       2

                "TRADING  MARKET"  means the  following  markets or exchanges on
which the Company's  common stock is listed or quoted for trading on the date in
question:  the American Stock Exchange,  the New York Stock Exchange, the Nasdaq
National Market or the Nasdaq SmallCap Market.

            2. REGISTRATION.

                (a) On or prior to the Filing Date,  the Company  shall  prepare
and file with the Commission a Registration Statement covering the resale of all
Registrable Securities for an offering to be made on a continuous basis pursuant
to Rule 415.  The  Registration  Statement  shall be on Form S-3  (except if the
Company is not then eligible to register for resale the  Registrable  Securities
on Form S-3,  in which case such  registration  shall be on another  appropriate
form for such purpose) and shall contain (except if otherwise  required pursuant
to  written  comments  received  from  the  Commission  upon a  review  of  such
Registration  Statement) the "Plan of Distribution"  attached hereto as Annex A.
The Company shall use its best efforts to cause the Registration Statement to be
declared  effective  under the  Securities  Act as soon as possible  but, in any
event, no later than the  Effectiveness  Date, and shall use its best efforts to
keep the Registration  Statement continuously effective under the Securities Act
until the  earlier of (i) the date that all  Registrable  Securities  covered by
such Registration  Statement have been sold, (ii) the second  anniversary of the
Closing Date or (iii) such earlier date when all Registrable  Securities covered
by the  Registration  Statement  have  been sold or may be sold  without  volume
restrictions pursuant to Rule 144(k) as determined by the counsel to the Company
pursuant to a written opinion letter to such effect, addressed and acceptable to
the  Company's  transfer  agent and the  affected  Holders  (the  "EFFECTIVENESS
PERIOD").

                (b) If: (i) a Registration Statement is not filed on or prior to
its Filing Date, or (ii) a Registration  Statement is not declared  effective by
the  Commission on or prior to the required  Effectiveness  Date, or (iii) after
the  Effective  Date,  such  Registration  Statement  ceases to be effective and
available  to the  Holders  as to all  Registrable  Securities  to  which  it is
required  to cover at any time  prior  to the  expiration  of its  Effectiveness
Period,  (any such  failure or breach  being  referred to as an "EVENT," and for
purposes  of clauses  (i),  (ii) or (iii) the date on which  such Event  occurs,
being  referred to as "EVENT  DATE"),  then,  in  addition  to any other  rights
available to the Holders: (x) on each such Event Date the Company shall issue to
each  Holder,  as  liquidated  damages and not as a penalty,  0.25 shares of its
common  stock  for every  Share  purchased  by that  Purchaser  pursuant  to the
Purchase  Agreement  (rounded up to the nearest  whole share taking into account
all Shares purchased by such Purchaser);  and (y) on each monthly anniversary of
each such Event Date thereof (if the applicable  Event shall not have been cured
by such date) until the  applicable  Event is cured,  the Company shall issue to
each Holder 0.10 shares of its common stock for every Share  purchased  pursuant
to the  Purchase  Agreement  (rounded up to the nearest  whole share taking into
account all Shares purchased by such Purchaser). The liquidated damages pursuant
to the terms  hereof  shall apply on a pro rata basis for any portion of a month
prior to the cure of an Event rounded up to the nearest whole share.

                (c) Notwithstanding  anything in this Agreement to the contrary,
the Company may, by written notice to the Purchasers,  suspend the effectiveness
of a Registration Statement after the Effective Date thereof and/or require that
the  Purchasers  immediately  cease the sale of shares of Common Stock  pursuant
thereto and/or defer the filing of any subsequent  Registration Statement for up

                                       3

to 45  consecutive  days (the  "Deferral  Period") in any 90-day period  without
paying  liquidated  damages,  if  the  Company  determines  in  good  faith,  by
appropriate  resolutions or action by its Board of Directors,  that (A) it would
be materially  detrimental to the Company (other than as relating  solely to the
price of the Common Stock) to file a Registration Statement at such time and (B)
it is in the best  interests  of the  Company  to  defer  proceeding  with  such
registration at such time; provided,  however,  that in the event the disclosure
relates  to a  previously  undisclosed  proposed  or pending  material  business
transaction,  the disclosure of which the Company determines in good faith would
be  reasonably  likely  to impede  the  Company's  ability  to  consummate  such
transaction,  the Company  may extend a Deferral  Period from 45 days to 60 days
without paying  liquidated  damages pursuant to Section 2(b);  provided further,
however,  that  Deferral  Periods  (including  but not  limited to any  extended
Deferral  Periods  under  clause  (B)) may not  total  more  than 60 days in the
aggregate  in any  twelve-month  period.  Upon  receipt  of  such  notice,  each
Purchaser  shall  immediately  discontinue  any sales of Registrable  Securities
pursuant to such  registration  until such  Purchaser  has received  copies of a
supplemented or amended Prospectus or until such Purchaser is advised in writing
by the Company  that the  then-current  Prospectus  may be used and has received
copies of any additional or supplemental filings that are incorporated or deemed
incorporated by reference in such Prospectus.  In no event, however,  shall this
right be exercised to suspend  sales beyond the period during which (in the good
faith  determination of the Company's Board of Directors) the failure to require
such suspension would be materially detrimental to the Company.

            3. CONSENTS.

               Prior to filing the Registration  Statement,  the Company and its
Subsidiaries  shall make or obtain all Permits  necessary or  desirable  for the
consummation of the Transactions contemplated hereby.

            4. REGISTRATION PROCEDURES

               In  connection  with  the  Company's   registration   obligations
hereunder, the Company shall:

               (a) Not less than  three  Trading  Days  prior to the filing of a
Registration  Statement or any related Prospectus or any amendment or supplement
thereto, the Company shall furnish to the Holders and the Special Counsel copies
of all such  documents  proposed to be filed which  documents  (other than those
incorporated  or deemed to be  incorporated by reference) will be subject to the
reasonable review of such Holders and the Special Counsel. The Company shall not
file a  Registration  Statement  or any such  Prospectus  or any  amendments  or
supplements  (other than  periodic  reports  required  under the  Exchange  Act)
thereto to which the Holders of a majority of the Registrable  Securities or the
Special  Counsel shall  reasonably  object in writing within two Trading Days of
receipt.

               (b) (i)  Subject  to  Section  2(c),  prepare  and file  with the
Commission  such  amendments,   including  post-effective  amendments,  to  each
Registration Statement and the Prospectus used in connection therewith as may be
necessary to keep such Registration  Statement  continuously effective as to the
applicable  Registrable  Securities for its Effectiveness Period and prepare and
file with the Commission  such  additional  Registration  Statements in order to

                                       4

register for resale under the Securities Act all of the Registrable  Securities;
(ii) cause the related  Prospectus to be amended or supplemented by any required
Prospectus supplement, and as so supplemented or amended to be filed pursuant to
Rule 424;  (iii)  respond as promptly  as  reasonably  possible to any  comments
received from the Commission with respect to each Registration  Statement or any
amendment thereto and, as promptly as reasonably possible, upon request, provide
the  Holders  true and  complete  copies of all  correspondence  from and to the
Commission relating to such Registration  Statement that would not result in the
disclosure to the Holders of material and non-public  information concerning the
Company;  and (iv) comply in all material  respects  with the  provisions of the
Securities Act and the Exchange Act with respect to the Registration  Statements
and the disposition of all Registrable  Securities  covered by each Registration
Statement  during the applicable  period in accordance with the intended methods
of disposition by the Purchasers thereof set forth in the Registration Statement
as so amended or in such Prospectus as so supplemented.

               (c) Notify the  Holders  and the  Special  Counsel as promptly as
reasonably  possible  (and,  in the case of (i)(A)  below,  not less than  three
Trading Days prior to such filing) and (if requested by any such Person) confirm
such notice in writing  promptly  following  the day (i)(A) when a Prospectus or
any  Prospectus  supplement  or  post-effective   amendment  to  a  Registration
Statement is proposed to be filed; (B) when the Commission  notifies the Company
whether there will be a "review" of such Registration Statement and whenever the
Commission comments in writing on such Registration Statement (the Company shall
provide true and complete  copies thereof and all written  responses  thereto to
each of the  Holders and the Special  Counsel  that  pertain to the Holders as a
Selling  Stockholder or to the Plan of Distribution,  but not information  which
the Company believes would constitute material and non-public information);  and
(C) with respect to each Registration Statement or any post-effective amendment,
when the same has become effective; (ii) of any request by the Commission or any
other Federal or state governmental authority for amendments or supplements to a
Registration Statement or Prospectus or for additional information; (iii) of the
issuance by the Commission of any stop order  suspending the  effectiveness of a
Registration  Statement covering any or all of the Registrable Securities or the
initiation  of any  Proceedings  for that  purpose;  (iv) of the  receipt by the
Company of any notification  with respect to the suspension of the qualification
or exemption from qualification of any of the Registrable Securities for sale in
any  jurisdiction,  or the  initiation or threatening of any Proceeding for such
purpose;  and (v) of the  occurrence  of any event or passage of time that makes
the financial  statements  included in a Registration  Statement  ineligible for
inclusion  therein  or any  statement  made in such  Registration  Statement  or
Prospectus or any document  incorporated or deemed to be incorporated therein by
reference  untrue in any material respect or that requires any revisions to such
Registration  Statement,  Prospectus or other  documents so that, in the case of
such Registration  Statement or the Prospectus,  as the case may be, it will not
contain any untrue  statement  of a material  fact or omit to state any material
fact required to be stated therein or necessary to make the statements  therein,
in light of the circumstances under which they were made, not misleading.

               (d) Use its best efforts to avoid the issuance of, or, if issued,
obtain  the  withdrawal  of (i) any  order  suspending  the  effectiveness  of a
Registration  Statement,  or  (ii)  any  suspension  of  the  qualification  (or
exemption from  qualification) of any of the Registrable  Securities for sale in
any jurisdiction, at the earliest practicable moment.

                                       5

               (e) Furnish to each Holder by email,  hand  delivery or overnight
courier,  without  charge,  at least  one  conformed  copy of each  Registration
Statement and each amendment  thereto,  and all exhibits to the extent requested
by such  Person  (other  than those  previously  furnished  or  incorporated  by
reference) promptly after the filing of such documents with the Commission.

               (f) Promptly  deliver to each  Holder,  without  charge,  as many
copies of each  Prospectus or  Prospectuses  (including each form of prospectus)
and each amendment or supplement thereto as such Persons may reasonably request.
The Company hereby  consents to the use of such Prospectus and each amendment or
supplement  thereto  by each of the  selling  Holders  in  connection  with  the
offering and sale of the Registrable  Securities  covered by such Prospectus and
any amendment or supplement thereto to the extent permitted by federal and state
securities laws and regulations.

               (g) Prior to any public offering of Registrable  Securities,  use
its reasonable best efforts to register or qualify or cooperate with the selling
Holders in connection with the registration or qualification  (or exemption from
such registration or qualification) of such Registrable Securities for offer and
sale  under the  securities  or Blue Sky laws of such  jurisdictions  within the
United States as any Holder requests in writing,  to keep each such registration
or qualification  (or exemption  therefrom)  effective during the  Effectiveness
Period  and to do any and all other acts or things  necessary  or  advisable  to
enable the  disposition  in such  jurisdictions  of the  Registrable  Securities
covered by the Registration Statements;  provided, that the Company shall not be
obligated  to file any general  consent to service of process or to qualify as a
foreign corporation or as a dealer in securities in any jurisdiction in which it
is not so  qualified  or to subject  itself to  material  taxation in respect of
doing business in any jurisdiction in which it is not otherwise so subject.

               (h)  Cooperate   with  the  Holders  to  facilitate   the  timely
preparation and delivery of certificates  representing Registrable Securities to
be delivered  to a transferee  pursuant to the  Registration  Statements,  which
certificates  shall be free, to the extent permitted by the Purchase  Agreement,
of all restrictive legends,  and to enable such Registrable  Securities to be in
such denominations and registered in such names as any such Holders may request.

               (i)  Upon  the  occurrence  of any  event  described  in  Section
4(c)(v), as promptly as reasonably possible,  prepare a supplement or amendment,
including a post-effective amendment, to the affected Registration Statements or
a supplement to the related Prospectus or any document incorporated or deemed to
be incorporated  therein by reference,  and file any other required  document so
that, as thereafter delivered, no Registration Statement nor any Prospectus will
contain an untrue  statement of a material fact or omit to state a material fact
required to be stated  therein or necessary to make the statements  therein,  in
light of the circumstances under which they were made, not misleading.

               (j)  Comply  with all  applicable  rules and  regulations  of the
Commission.

               (k) The Company may require each selling Holder to furnish to the
Company a  certified  statement  as to the  number  of  shares  of Common  Stock
beneficially owned by such Holder and any controlling person thereof.

                                       6

            5.  REGISTRATION  EXPENSES.  All fees and  expenses  incident to the
performance  of or compliance  with this Agreement by the Company shall be borne
by the Company whether or not any Registrable  Securities are sold pursuant to a
Registration  Statement.  The fees and  expenses  referred  to in the  foregoing
sentence shall include, without limitation, (i) all registration and filing fees
(including,  without  limitation,  fees and expenses (A) with respect to filings
required  to be made with any Trading  Market on which the Common  Stock is then
listed for trading,  and (B) in compliance with applicable  state  securities or
Blue Sky laws), (ii) printing expenses (including, without limitation,  expenses
of printing certificates for Registrable Securities and of printing prospectuses
if the  printing of  prospectuses  is  reasonably  requested by the holders of a
majority of the Registrable Securities included in the Registration  Statement),
(iii) messenger, telephone and delivery expenses, (iv) fees and disbursements of
counsel for the Company, (v) Securities Act liability insurance,  if the Company
so desires  such  insurance,  and (vi) fees and  expenses  of all other  Persons
retained by the Company in connection with the  consummation of the transactions
contemplated  by this Agreement.  In addition,  the Company shall be responsible
for all of its internal expenses incurred in connection with the consummation of
the transactions contemplated by this Agreement (including,  without limitation,
all salaries and expenses of its  officers  and  employees  performing  legal or
accounting  duties),  the expense of any annual  audit and the fees and expenses
incurred in  connection  with the listing of the  Registrable  Securities on any
securities exchange as required hereunder.

            6. INDEMNIFICATION.

               (a)   INDEMNIFICATION   BY  THE  COMPANY.   The  Company   shall,
notwithstanding  any termination of this Agreement,  indemnify and hold harmless
each Holder, the officers,  directors, agents, investment advisors and employees
of each of them, each Person who controls any such Holder (within the meaning of
Section 15 of the  Securities  Act or Section  20 of the  Exchange  Act) and the
officers,  directors,  agents and employees of each such controlling  Person, to
the fullest  extent  permitted by  applicable  law, from and against any and all
losses,  claims,  damages,  liabilities,  costs (including,  without limitation,
reasonable  costs of preparation  and reasonable  attorneys'  fees) and expenses
(collectively,  "LOSSES"), as incurred, arising out of or relating to any untrue
or alleged  untrue  statement of a material fact  contained in any  Registration
Statement,  any  Prospectus  or any form of  prospectus  or in any  amendment or
supplement  thereto,  or arising out of or  relating to any  omission or alleged
omission of a material fact  required to be stated  therein or necessary to make
the  statements  therein (in the case of any Prospectus or form of prospectus or
supplement  thereto,  in light of the circumstances  under which they were made)
not  misleading,  except to the extent,  but only to the  extent,  that (1) such
untrue statements or omissions are based solely upon information  regarding such
Holder  furnished  in writing to the  Company by such Holder  expressly  for use
therein,  or to the extent that such information  relates to such Holder or such
Holder's  proposed  method of  distribution  of  Registrable  Securities and was
reviewed and expressly  approved in writing by such Holder  expressly for use in
the Registration Statement, such Prospectus or such form of Prospectus or in any
amendment  or  supplement  thereto  (it being  understood  that the  Holder  has
approved Annex A hereto for this purpose) or (2) in the case of an occurrence of
an event of the type specified in Section  4(c)(ii)-(v),  the use by such Holder
of an outdated or  defective  Prospectus  after the  Company has  notified  such
Holder in writing that the  Prospectus is outdated or defective and prior to the
receipt by such Holder of the Advice  contemplated in Section 7(d) or an amended
or  supplemented  Prospectus,  but only if and to the extent that  following the

                                       7

receipt of the Advice or the amended or supplemented Prospectus the misstatement
or omission  giving rise to such Loss would have been  completely  corrected  by
such Advice or the amended or  supplemented  Prospectus  and the Holder fails to
deliver such Advice or amended or  supplemented  Prospectus.  The Company  shall
notify the  Holders  promptly of the  institution,  threat or  assertion  of any
Proceeding  of which the Company is aware in  connection  with the  transactions
contemplated by this Agreement.

               (b) INDEMNIFICATION BY HOLDERS. Each Holder shall,  severally and
not jointly,  indemnify and hold harmless the Company, its directors,  officers,
agents and employees,  each Person who controls the Company  (within the meaning
of Section 15 of the Securities Act and Section 20 of the Exchange Act), and the
directors,  officers,  agents or employees of such controlling  Persons,  to the
fullest  extent  permitted by applicable  law,  from and against all Losses,  as
incurred,  arising out of or based upon (x) such Holder's failure to comply with
the prospectus  delivery  requirements of the Securities Act, if the delivery of
such a  prospectus  would have cured or  prevented  the Loss,  or (y) any untrue
statement  of a material  fact  contained  in any  Registration  Statement,  any
Prospectus,  or any  form  of  prospectus,  or in any  amendment  or  supplement
thereto,  or  arising  out of or based  upon any  omission  of a  material  fact
required to be stated  therein or necessary to make the  statements  therein not
misleading  to the  extent,  but  only  to the  extent  that,  (1)  such  untrue
statements or omissions are based solely upon information  regarding such Holder
furnished in writing to the Company by such Holder expressly for use therein, or
to the extent  that such  information  relates to such  Holder or such  Holder's
proposed method of  distribution of Registrable  Securities and was reviewed and
expressly  approved  in  writing  by  such  Holder  expressly  for  use  in  the
Registration Statement (it being understood that the Holder has approved Annex A
hereto for this purpose),  such  Prospectus or such form of Prospectus or in any
amendment or supplement  thereto or (2) in the case of an occurrence of an event
of the type  specified  in Section  4(c)(ii)-(v),  the use by such  Holder of an
outdated or defective  Prospectus  after the Company has notified such Holder in
writing that the Prospectus is outdated or defective and prior to the receipt by
such Holder of an Advice or an amended or supplemented  Prospectus,  but only if
and to the extent  that  following  the  receipt of the Advice or the amended or
supplemented  Prospectus the  misstatement  or omission giving rise to such Loss
would  have  been  completely  corrected  by  such  Advice  or  the  amended  or
supplemented  Prospectus  and the Holder fails to deliver such Advice or amended
or  supplemented  Prospectus.  In no event  shall the  liability  of any selling
Holder hereunder be greater in amount than the dollar amount of the net proceeds
received by such Holder upon the sale of the Registrable  Securities giving rise
to such indemnification obligation.

               (c) CONDUCT OF  INDEMNIFICATION  PROCEEDINGS.  If any  Proceeding
shall be brought or asserted against any Person entitled to indemnity  hereunder
(an  "INDEMNIFIED  PARTY"),  such  Indemnified  Party shall promptly  notify the
Person from whom indemnity is sought (the "INDEMNIFYING  PARTY") in writing, and
the  Indemnifying  Party  shall  assume  the  defense  thereof,   including  the
employment of counsel  reasonably  satisfactory to the Indemnified Party and the
payment of all fees and expenses  incurred in connection  with defense  thereof;
provided,  that the failure of any  Indemnified  Party to give such notice shall
not relieve the Indemnifying Party of its obligations or liabilities pursuant to
this  Agreement,  except  (and  only) to the  extent  that it  shall be  finally
determined  by a court of competent  jurisdiction  (which  determination  is not
subject to appeal or further  review) that such failure  shall have  proximately
and materially adversely prejudiced the Indemnifying Party.

                                       8

                    An Indemnified Party shall have the right to employ separate
counsel in any such  Proceeding and to participate in the defense  thereof,  but
the  fees  and  expenses  of  such  counsel  shall  be at the  expense  of  such
Indemnified  Party or Parties unless:  (1) the Indemnifying  Party has agreed in
writing to pay such fees and  expenses;  (2) the  Indemnifying  Party shall have
failed  promptly to assume the defense of such  Proceeding and to employ counsel
reasonably satisfactory to such Indemnified Party in any such Proceeding; or (3)
the named  parties to any such  Proceeding  (including  any  impleaded  parties)
include  both  such  Indemnified  Party  and the  Indemnifying  Party,  and such
Indemnified Party shall have been advised by counsel that a conflict of interest
is likely to exist if the same counsel were to represent such Indemnified  Party
and the Indemnifying  Party (in which case, if such  Indemnified  Party notifies
the  Indemnifying  Party in writing that it elects to employ separate counsel at
the expense of the Indemnifying Party, the Indemnifying Party shall not have the
right to assume the defense  thereof and such counsel shall be at the expense of
the Indemnifying  Party).  It being understood,  however,  that the Indemnifying
Party shall not, in  connection  with any one such  Proceeding be liable for the
fees and  expenses of more than one  separate  firm of attorneys at any time for
all  Indemnified  Parties,  which firm shall be  appointed  by a majority of the
Indemnified  Parties.  The  Indemnifying  Party  shall  not be  liable  for  any
settlement of any such Proceeding  effected without its written  consent,  which
consent shall not be unreasonably withheld. No Indemnifying Party shall, without
the prior written consent of the Indemnified Party, effect any settlement of any
pending Proceeding in respect of which any Indemnified Party is a party,  unless
such settlement includes an unconditional release of such Indemnified Party from
all liability on claims that are the subject matter of such Proceeding.

                    All reasonable  fees and expenses of the  Indemnified  Party
(including  reasonable  fees and expenses to the extent  incurred in  connection
with  investigating  or  preparing  to defend  such  Proceeding  in a manner not
inconsistent  with this Section) that are to be paid by the  Indemnifying  Party
pursuant to this Section shall be paid to the  Indemnified  Party,  as incurred,
within ten Trading Days of written  notice  thereof to the  Indemnifying  Party;
provided,  that the  Indemnifying  Party may require such  Indemnified  Party to
undertake  to  reimburse  all such fees and expenses to the extent it is finally
judicially   determined  that  such   Indemnified   Party  is  not  entitled  to
indemnification hereunder).

                (d) CONTRIBUTION.  If a claim for indemnification  under Section
6(a) or 6(b) is unavailable to an Indemnified  Party (by reason of public policy
or  otherwise),  then each  Indemnifying  Party,  in lieu of  indemnifying  such
Indemnified  Party,  shall  contribute  to the  amount  paid or  payable by such
Indemnified  Party  as a  result  of  such  Losses,  in  such  proportion  as is
appropriate  to  reflect  the  relative  fault  of the  Indemnifying  Party  and
Indemnified  Party in connection with the actions,  statements or omissions that
resulted in such Losses as well as any other relevant equitable  considerations.
The relative fault of such  Indemnifying  Party and  Indemnified  Party shall be
determined by reference to, among other things,  whether any action in question,
including any untrue or alleged untrue  statement of a material fact or omission
or alleged omission of a material fact, has been taken or made by, or relates to
information  supplied by, such Indemnifying  Party or Indemnified Party, and the
parties'  relative intent,  knowledge,  access to information and opportunity to
correct or prevent  such  action,  statement  or  omission.  The amount  paid or
payable by a party as a result of any Losses shall be deemed to include, subject
to the limitations set forth in Section 6(c), any reasonable attorneys' or other

                                       9

reasonable  fees or  expenses  incurred  by such  party in  connection  with any
Proceeding to the extent such party would have been indemnified for such fees or
expenses if the  indemnification  provided for in this Section was  available to
such party in accordance with its terms.

                The parties hereto agree that it would not be just and equitable
if  contribution  pursuant  to this  Section  6(d) were  determined  by pro rata
allocation or by any other method of allocation  that does not take into account
the equitable considerations referred to in the immediately preceding paragraph.
Notwithstanding the provisions of this Section 6(d), no Holder shall be required
to contribute, in the aggregate, any amount in excess of the amount by which the
proceeds  actually  received  by such  Holder  from the sale of the  Registrable
Securities  subject to the  Proceeding  exceeds the amount of damages  that such
Holder has  otherwise  been  required to pay by reason of such untrue or alleged
untrue statement or omission or alleged omission, except in the case of fraud by
such  Holder.  No Person  guilty of  fraudulent  misrepresentation  (within  the
meaning  of  SECTION  11(f)  of  the  Securities   Act)  shall  be  entitled  to
contribution   from  any  Person   who  was  not   guilty  of  such   fraudulent
misrepresentation.

                The  indemnity  and  contribution  agreements  contained in this
Section are in addition to any liability that the Indemnifying  Parties may have
to the Indemnified Parties.

            7. MISCELLANEOUS

               (a)  REMEDIES.  In the event of a breach by the  Company  or by a
Holder,  of any of their  obligations  under this Agreement,  each Holder or the
Company,  as the case may be, in  addition to being  entitled  to  exercise  all
rights granted by law and under this Agreement,  including  recovery of damages,
will be entitled to specific performance of its rights under this Agreement. The
Company and each Holder agree that monetary  damages would not provide  adequate
compensation  for any losses  incurred by reason of a breach by it of any of the
provisions of this Agreement and hereby further agrees that, in the event of any
action for specific  performance  in respect of such breach,  it shall waive the
defense that a remedy at law would be adequate.

               (b) NO  PIGGYBACK ON  REGISTRATIONS.  Except as and to the extent
specified in Schedule  7(b) hereto,  neither the Company nor any of its security
holders  (other than the Holders in such capacity  pursuant  hereto) may include
securities  of  the  Company  in  the  Registration  Statement  other  than  the
Registrable  Securities,  and the Company  shall not after the date hereof enter
into any  agreement  providing  any such right to any of its  security  holders.
Except as and to the extent  specified in Schedule 7(b) hereto,  the Company has
not previously entered into any agreement granting any registration  rights with
respect  to any of its  securities  to any  Person  which  have not  been  fully
satisfied.

               (c)  COMPLIANCE.  Each Holder  covenants  and agrees that it will
comply  with the  prospectus  delivery  requirements  of the  Securities  Act as
applicable to it in connection with sales of Registrable  Securities pursuant to
the Registration Statement.

               (d)   DISCONTINUED   DISPOSITION.   Each  Holder  agrees  by  its
acquisition of such  Registrable  Securities that, upon receipt of a notice from
the Company of the occurrence of any event of the kind described in Section 4(c)
or (e), such Holder will forthwith  discontinue  disposition of such Registrable
Securities under the  Registration  Statement until such Holder's receipt of the

                                       10

copies of the supplemented  Prospectus and/or amended Registration  Statement or
until it is advised in writing (in each case,  "ADVICE") by the Company that the
use of the  applicable  Prospectus  may be  resumed,  and, in either  case,  has
received copies of any additional or supplemental  filings that are incorporated
or deemed to be  incorporated  by reference in such  Prospectus or  Registration
Statement.  The  Company  may  provide  appropriate  stop  orders to enforce the
provisions of this paragraph.

               (e)  PIGGY-BACK   REGISTRATIONS.   If  at  any  time  during  the
Effectiveness Period there is not an effective  Registration  Statement covering
all of the Registrable Securities and the Company shall determine to prepare and
file with the  Commission a registration  statement  relating to an offering for
its own account or the account of others under the  Securities Act of any of its
equity securities, other than on Form S-4 or Form S-8 (each as promulgated under
the Securities Act) or their then equivalents  relating to equity  securities to
be issued solely in connection with any acquisition of any entity or business or
equity  securities  issuable in connection  with stock option or other  employee
benefit plans, then the Company shall send to each Holder written notice of such
determination and, if within fifteen days after receipt of such notice, any such
Holder  shall  so  request  in  writing,  the  Company  shall  include  in  such
registration  statement  all or any  part of such  Registrable  Securities  such
holder  requests to be  registered,  subject to customary  underwriter  cutbacks
applicable to all holders of registration rights.

               (f)  AMENDMENTS AND WAIVERS.  The  provisions of this  Agreement,
including  the  provisions  of this  sentence,  may not be amended,  modified or
supplemented,  and waivers or consents to departures from the provisions  hereof
may not be given,  unless the same shall be in writing and signed by the Company
and the Holders of a majority of the then  outstanding  Registrable  Securities.
Notwithstanding the foregoing, a waiver or consent to depart from the provisions
hereof  with  respect  to a matter  that  relates  exclusively  to the rights of
certain  Holders and that does not directly or  indirectly  affect the rights of
other Holders may be given by Holders of at least a majority of the  Registrable
Securities  to  which  such  waiver  or  consent  relates,  provided,  that  the
provisions of this sentence may not be amended, modified, or supplemented except
in accordance with the provisions of the immediately preceding sentence.

               (g)  NOTICES.  Any and all  notices  or other  communications  or
deliveries  required or permitted to be provided  hereunder  shall be in writing
and  shall be deemed  given and  effective  on the  earliest  of (i) the date of
transmission,  if such notice or communication is delivered via facsimile at the
facsimile  number  specified in this Section  prior to 6:30 p.m.  (New York City
time) on a Trading Day, (ii) the Trading Day after the date of transmission,  if
such  notice or  communication  is  delivered  via  facsimile  at the  facsimile
telephone number specified in this Agreement later than 6:30 p.m. (New York City
time) on any date and earlier than 11:59 p.m. (New York City time) on such date,
(iii) the  Trading Day  following  the date of  mailing,  if sent by  nationally
recognized  overnight courier service,  or (iv) upon actual receipt by the party
to whom such notice is required  to be given.  The address for such  notices and
communications shall be as follows:

                                       11

            If to the Company:   Empire Resorts, Inc.
                                 c/o Monticello Raceway
                                 Route 17B
                                 Monticello, NY  12701

            With a copy to:      Olshan Grundman Frome Rosenzweig & Wolosky LLP
                                 Park Avenue Tower
                                 65 East 55th Street
                                 New York, New York 10022
                                 Attn:  Robert H. Friedman
                                 Facsimile No.:  (212) 451-2222

            If to a Purchaser:   To the address set forth under such Purchaser's
                                 name on the signature pages hereto.

                                 If to  Special  Counsel:  to  such  address  as
                                 provided  to the  Company  following  the  date
                                 hereof  by  Purchasers  representing  at  least
                                 66.67% in interest of all Purchasers.

            If to any other Person who is then the registered Holder:

                                 To the  address of such Holder as it appears in
                                 the stock transfer books of the Company

or such other  address as may be designated  in writing  hereafter,  in the same
manner, by such Person.

                (h)  SUCCESSORS AND ASSIGNS.  This Agreement  shall inure to the
benefit of and be binding upon the successors  and permitted  assigns of each of
the parties and shall inure to the benefit of each  Holder.  The Company may not
assign its rights or obligations  hereunder without the prior written consent of
each Holder.  Each Holder may assign their  respective  rights  hereunder in the
manner  and to the  Persons  as  permitted  to a  Purchaser  under the  Purchase
Agreement.

                (i) EXECUTION AND  COUNTERPARTS.  This Agreement may be executed
in any number of counterparts, each of which when so executed shall be deemed to
be an original and, all of which taken  together  shall  constitute  one and the
same  Agreement.  In the event that any  signature  is  delivered  by  facsimile
transmission,  such  signature  shall create a valid  binding  obligation of the
party  executing  (or on whose behalf such  signature is executed) the same with
the same  force and  effect as if such  facsimile  signature  were the  original
thereof.

                (j) GOVERNING LAW. All questions  concerning  the  construction,
validity,  enforcement and interpretation of this Agreement shall be governed by
and construed and enforced in accordance  with the internal laws of the State of
New York,  without  regard to the  principles of conflicts of law thereof.  Each
party agrees that all Proceedings  concerning the  interpretations,  enforcement
and defense of the transactions  contemplated by this Agreement (whether brought
against a party hereto or its respective Affiliates,  employees or agents) shall

                                       12

be commenced  exclusively in the state and federal courts sitting in the City of
New York, Borough of Manhattan (the "NEW YORK COURTS"). Each party hereto hereby
irrevocably submits to the exclusive jurisdiction of the New York Courts for the
adjudication  of any dispute  hereunder  or in  connection  herewith or with any
transaction  contemplated  hereby or discussed  herein,  and hereby  irrevocably
waives,  and  agrees not to assert in any  Proceeding,  any claim that it is not
personally  subject  to the  jurisdiction  of any New York  Court,  or that such
Proceeding has been commenced in an improper or inconvenient  forum.  Each party
hereto hereby  irrevocably  waives  personal  service of process and consents to
process  being  served in any such  Proceeding  by  mailing a copy  thereof  via
registered or certified  mail or overnight  delivery (with evidence of delivery)
to such party at the  address in effect for  notices to it under this  Agreement
and agrees that such service shall  constitute  good and  sufficient  service of
process and notice thereof. Nothing contained herein shall be deemed to limit in
any way any right to serve  process in any manner  permitted by law.  Each party
hereto hereby irrevocably  waives, to the fullest extent permitted by applicable
law,  any and all  right to trial by jury in any  Proceeding  arising  out of or
relating to this Agreement or the transactions  contemplated  hereby.  If either
party shall commence a Proceeding to enforce any  provisions of this  Agreement,
then the prevailing  party in such  Proceeding  shall be reimbursed by the other
party for its  attorney's  fees and other costs and expenses  incurred  with the
investigation, preparation and prosecution of such Proceeding.

                (k)  CUMULATIVE  REMEDIES.  The  remedies  provided  herein  are
cumulative and not exclusive of any remedies provided by law.

                (l)   SEVERABILITY.   If  any  term,   provision,   covenant  or
restriction of this Agreement is held by a court of competent jurisdiction to be
invalid, illegal, void or unenforceable, the remainder of the terms, provisions,
covenants  and  restrictions  set forth  herein  shall  remain in full force and
effect and shall in no way be affected, impaired or invalidated, and the parties
hereto  shall use their  reasonable  efforts to find and  employ an  alternative
means to achieve the same or substantially  the same result as that contemplated
by such term,  provision,  covenant or restriction.  It is hereby stipulated and
declared to be the  intention of the parties  that they would have  executed the
remaining terms, provisions, covenants and restrictions without including any of
such that may be hereafter declared invalid, illegal, void or unenforceable.

                (m) HEADINGS. The headings in this Agreement are for convenience
of reference only and shall not limit or otherwise affect the meaning hereof.

                (n)  INDEPENDENT  NATURE OF PURCHASERS'  OBLIGATIONS AND RIGHTS.
The  obligations of each  Purchaser  hereunder is several and not joint with the
obligations  of any  other  Purchaser  hereunder,  and  no  Purchaser  shall  be
responsible  in any way for the  performance  of the  obligations  of any  other
Purchaser  hereunder.  Nothing  contained  herein or in any other  agreement  or
document delivered at any closing, and no action taken by any Purchaser pursuant
hereto  or  thereto,   shall  be  deemed  to  constitute  the  Purchasers  as  a
partnership,  an  association,  a joint venture or any other kind of entity,  or
create a presumption  that the  Purchasers are in any way acting in concert with
respect to such obligations or the transactions  contemplated by this Agreement.
Each  Purchaser  shall be entitled to protect and enforce its rights,  including
without limitation the rights arising out of this Agreement, and it shall not be
necessary  for any other  Purchaser to be joined as an  additional  party in any
proceeding for such purpose.

                                       13

                   [REMAINDER OF PAGE INTENTIONALLY LEFT BLANK
                           SIGNATURE PAGES TO FOLLOW]

                                       14

            IN WITNESS  WHEREOF,  the parties have  executed  this  Registration
Rights Agreement as of the date first written above.

                                       EMPIRE RESORTS, INC.

                                       By:_________________________________
                                       Name:
                                       Title:

                   [REMAINDER OF PAGE INTENTIONALLY LEFT BLANK
                    SIGNATURE PAGES OF PURCHASERS TO FOLLOW]

                                       15

            IN WITNESS  WHEREOF,  the parties have  executed  this  Registration
Rights Agreement as of the date first written above.

                                       --------------------------------------
                                       [Print name of Purchaser]

                                       By:_____________________________________
                                          Name:
                                          Title:

                                       Address for Notice:

                                       Facsimile No.:
                                       Attn:

                                       16

                                                                         Annex A

                              Plan of Distribution

            The  Selling  Stockholders  and  any  of  their  pledgees,   donees,
assignees and successors-in-interest  may, from time to time, sell any or all of
their shares of Common Stock on any stock exchange,  market or trading  facility
on which the shares are traded or in private transactions. These sales may be at
fixed or negotiated  prices.  Subject to  compliance  with  applicable  law, the
Selling  Stockholders  may use any one or  more of the  following  methods  when
selling shares:

o    ordinary brokerage transactions and transactions in which the broker-dealer
     solicits purchasers;

o    block trades in which the broker-dealer  will attempt to sell the shares as
     agent but may  position  and resell a portion of the block as  principal to
     facilitate the transaction;

o    purchases by a broker-dealer  as principal and resale by the  broker-dealer
     for its account;

o    an exchange  distribution  in accordance  with the rules of the  applicable
     exchange;

o    privately negotiated transactions;

o    short sales

o    broker-dealers may agree with the Selling  Stockholders to sell a specified
     number of such shares at a stipulated price per share;

o    a combination of any such methods of sale; and

o    any other method permitted pursuant to applicable law.

            The Selling  Stockholders  may also sell shares under Rule 144 under
the Securities Act, if available, rather than under this prospectus.

            Broker-dealers  engaged by the Selling  Stockholders may arrange for
other  brokers-dealers  to  participate  in sales.  Broker-dealers  may  receive
commissions or discounts from the Selling Stockholders (or, if any broker-dealer
acts as agent for the purchaser of shares,  from the purchaser) in amounts to be
negotiated.  The  Selling  Stockholders  do not  expect  these  commissions  and
discounts to exceed what is customary in the types of transactions involved.

            The  Selling  Stockholders  may from time to time  pledge or grant a
security  interest  in some or all of the  Shares  owned  by them  and,  if they
default in the performance of their secured obligations, the pledgees or secured
parties may offer and sell  shares of Common  Stock from time to time under this
prospectus,  or under an amendment to this  prospectus  under Rule  424(b)(3) or

                                       17

other  applicable  provision of the  Securities Act of 1933 amending the list of
selling  stockholders to include the pledgee,  transferee or other successors in
interest as selling stockholders under this prospectus.

            Upon the Company being notified in writing by a Selling  Stockholder
that any material arrangement has been entered into with a broker-dealer for the
sale  of  Common  Stock  through  a  block  trade,  special  offering,  exchange
distribution or secondary  distribution  or a purchase by a broker or dealer,  a
supplement  to this  prospectus  will be filed,  if  required,  pursuant to Rule
424(b) under the  Securities  Act,  disclosing (i) the name of each such Selling
Stockholder and of the participating broker-dealer(s), (ii) the number of shares
involved,  (iii) the price at which such the  shares of Common  Stock were sold,
(iv)the   commissions   paid  or  discounts  or  concessions   allowed  to  such
broker-dealer(s),  where  applicable,  (v) that  such  broker-dealer(s)  did not
conduct any  investigation  to verify the information set out or incorporated by
reference in this prospectus,  and (vi) other facts material to the transaction.
In addition, upon the Company being notified in writing by a Selling Stockholder
that a donee or pledge  intends to sell more than 500 shares of Common Stock,  a
supplement to this  prospectus will be filed if then required in accordance with
applicable securities law.

            The  Selling  Stockholders  also may  transfer  the shares of common
stock in other circumstances,  in which case the transferees,  pledgees or other
successors  in interest  will be the selling  beneficial  owners for purposes of
this prospectus.

            The Selling  Stockholders and any  broker-dealers or agents that are
involved  in selling  the shares may be deemed to be  "underwriters"  within the
meaning of the Securities Act in connection with such sales. In such event,  any
commissions  received  by such  broker-dealers  or agents  and any profit on the
resale  of the  shares  purchased  by  them  may be  deemed  to be  underwriting
commissions or discounts under the Securities Act. Each Selling Stockholders has
represented  and warranted to the Company that it does not have any agreement or
understanding,  directly or indirectly, with any person to distribute the Common
Stock.

            The Company is required to pay all fees and expenses incident to the
registration  of the shares.  The Company  has agreed to  indemnify  the Selling
Stockholders against certain losses, claims, damages and liabilities,  including
liabilities under the Securities Act.

                                       18sec document

                                                                   EXHIBIT 10.18

THIS  WARRANT  CERTIFICATE  AND THE  SHARES OF COMMON  STOCK  ISSUABLE  UPON THE
EXERCISE OF THIS WARRANT  CERTIFICATE  HAVE NOT BEEN REGISTERED UNDER THE UNITED
STATES  SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES  ACT"), OR QUALIFIED
UNDER  ANY STATE  SECURITIES  LAW,  AND MAY NOT BE SOLD,  PLEDGED  OR  OTHERWISE
TRANSFERRED  UNLESS THEY HAVE BEEN  REGISTERED  UNDER SUCH LAWS OR AN  EXEMPTION
FROM REGISTRATION IS AVAILABLE.

                                                                January 30, 2004

                         WARRANT CERTIFICATE TO PURCHASE
                                 cOMMON STOCK OF

                              EMPIRE RESORTS, INC.

            This Warrant  Certificate (the "WARRANT  CERTIFICATE") is to certify
that Jefferies & Company,  Inc. or its registered assigns (the  "WARRANTHOLDER")
is entitled at any time after the date hereof but prior to the  Expiration  Date
(as  hereinafter  defined),  to purchase,  at the Exercise Price (as hereinafter
defined) 250,000 shares of common stock (as modified  pursuant to SECTION 5, the
"INITIAL  EXERCISE AMOUNT") of Empire Resorts,  Inc. (the "COMPANY"),  par value
$.01 per share  (the  "COMMON  STOCK").  Unless  earlier  exercised  in full and
subject to the  conditions  set forth  herein,  this Warrant  Certificate  shall
expire at 5:00 P.M.,  New York City time,  on January 30, 2009 (the  "EXPIRATION
DATE").

            1. EXERCISE OF WARRANT.

               1.1 This Warrant  Certificate is exercisable by the Warrantholder
at the Exercise Price per share of Common Stock issuable  hereunder,  payable in
cash by wire transfer of immediately  available  funds, by certified or official
bank check or by surrender of other  Securities of the Company  whose  aggregate
principal  amount or stated  liquidation  value,  together  with any accrued but
unpaid  interest or principal due thereon,  is equal to the Exercise  Price.  In
lieu of payment of the Exercise Price as provided above, the  Warrantholder  may
elect a cashless net exercise.  In the case of such  cashless net exercise,  the
Warrantholder  shall  surrender this Warrant  Certificate for  cancellation  and
receive in exchange therefor the full number of duly authorized, validly issued,
fully  paid and  nonassessable  shares of Common  Stock  specified,  subject  to
adjustment  in  accordance  with  SECTION 5, less the number of shares of Common
Stock with an  aggregate  Fair Market  Value as of the business day on which the
Warrantholder  surrenders this Warrant Certificate to the Company (the "EXERCISE
DATE") equal to the aggregate  Exercise  Price.  Upon  surrender of this Warrant
Certificate  with the attached  Subscription  Form duly  completed and executed,
together  with any  required  payment  of the  Exercise  Price for the shares of
Common Stock being purchased,  at the Company's principal executive offices, the
Warrantholder shall be entitled to receive a certificate or certificates for the
shares of Common Stock so purchased.

               1.2 The purchase rights  represented by this Warrant  Certificate
are exercisable at the option of the Warrantholder, in whole or in part (but not
as to  fractional  shares  of Common  Stock),  at any time and from time to time
prior to the Expiration Date during the period in which this Warrant Certificate
may be exercised as set forth above.

               1.3 In the case of the  purchase  of less than all the  shares of
Common Stock  purchasable  under this  Warrant  Certificate,  the Company  shall
cancel this Warrant  Certificate upon the surrender hereof and shall, as soon as
practicable,  execute and deliver to the Warrantholder a new Warrant Certificate
to the Warrantholder of like tenor for the balance of the shares of Common Stock
purchasable hereunder.

            2. ISSUANCE OF STOCK CERTIFICATES.

               2.1 The issuance of certificates  for shares of Common Stock upon
the exercise of this Warrant  Certificate  shall be made as soon as  practicable
thereafter or in any event within five (5) days of such exercise  without charge
to the Warrantholder, including, without limitation, any tax that may be payable
in respect thereof,  and such  certificates  shall (subject to the provisions of
this  SECTION 2) be issued in the name of, or in such  names as may be  directed
by, the Warrantholder; provided, however, that the Company shall not be required
to pay any income tax to which the  Warrantholder  may be subject in  connection
with the issuance of this Warrant  Certificate or of shares of Common Stock upon
the exercise of this Warrant Certificate;  provided,  further,  that the Company
shall not be  required  to pay any tax that may be  payable  in  respect  of any
transfer involved in the issuance and delivery of any such certificate in a name
other than that of the  Warrantholder  and the Company  shall not be required to
issue or  deliver  such  certificates  unless  or until the  person  or  persons
requesting  the  issuance  thereof  shall have paid to the Company the amount of
such tax or shall have established to the reasonable satisfaction of the Company
that such tax has been paid.

               2.2 All shares of Common  Stock  issued upon the exercise of this
Warrant Certificate shall be validly issued, fully paid and nonassessable.

               2.3 Each person in whose name any such  certificate for shares of
Common  Stock is issued  shall for all  purposes  be deemed to have  become  the
holder of record of such shares on the date on which the Warrant Certificate was
surrendered and payment of the Exercise Price and any applicable taxes was made,
irrespective  of the date of delivery of such  certificate,  except that, if the
date of such  surrender and payment is a date when the stock  transfer  books of
the Company are closed, such person shall be deemed to have become the holder of
such shares at the close of business  on the next  succeeding  date on which the
stock transfer books are open.

            3. RESTRICTIONS ON TRANSFER.

               3.1 INVESTMENT  REPRESENTATION AND TRANSFER  RESTRICTION  LEGEND.
The  Warrantholder,  by acceptance of this Warrant  Certificate,  represents and
warrants to the Company that it is acquiring  this Warrant  Certificate  and the
shares of Common Stock issued or issuable  upon  exercise  hereof (the  "WARRANT
SHARES") for investment  purposes only and not with a view towards the resale or
other distribution thereof. Each certificate representing Warrant Shares, unless

                                      -2-

at the same time of  exercise  such  Warrant  Shares  are  registered  under the
Securities Act, shall bear a legend in  substantially  the following form on the
face thereof:

               THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT
               BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933 OR ANY
               STATE SECURITIES LAWS AND MAY NOT BE TRANSFERRED EXCEPT
               PURSUANT TO AN EFFECTIVE REGISTRATION  STATEMENT, OR AN
               EXEMPTION FROM REGISTRATION, UNDER SAID LAWS.

            Any certificate  issued at any time in exchange or substitution  for
any  certificate  bearing  such  legend  (except a new  certificate  issued upon
completion  of a  distribution  under  a  registration  statement  covering  the
securities  represented  thereby)  shall also bear such  legend  unless,  in the
opinion of counsel to the Company,  the  securities  represented  thereby may be
transferred  as  contemplated  by such  Warrantholder  without  violation of the
registration requirements of the Securities Act.

            4. EXERCISE PRICE AND EXERCISE AMOUNT.

               4.1 INITIAL AND ADJUSTED  EXERCISE  PRICE.  The initial  exercise
price of this Warrant  Certificate shall be $7.50 per share of Common Stock (the
"INITIAL EXERCISE PRICE").  The Exercise Price may be adjusted from time to time
pursuant to the provisions of SECTION 5 hereof. The term "EXERCISE PRICE" herein
shall mean the Initial Exercise Price if no such adjustment shall have been made
or the Initial  Exercise Price as adjusted from time to time in accordance  with
such Section.

               4.2 EXERCISE  AMOUNT.  The Exercise  Amount may be adjusted  from
time to time pursuant to the provisions of SECTION 5 hereof.  The term "EXERCISE
AMOUNT"  herein  shall mean the Initial  Exercise  Amount if no such  adjustment
shall have been made or the Initial  Exercise  Amount as  adjusted  from time to
time in accordance with such Section.

            5. ADJUSTMENT OF EXERCISE PRICE AND EXERCISE AMOUNT.

               5.1 For  purposes  of this  Warrant  Certificate,  the  following
definitions shall apply:

                   (a)  "CONVERTIBLE  SECURITIES"  shall mean any  evidences  of
            indebtedness,  shares or other  Securities  directly  or  indirectly
            convertible into or exchangeable for Common Stock.

                   (b) "FAIR  MARKET  VALUE"  shall  mean,  with  respect to any
            Securities,  its  market  price as  determined  in good faith by the
            Company's  Board of  Directors  and with  respect to any property or
            assets  other  than  cash or  Securities,  the  fair  value  thereof
            determined in good faith by the Company's Board of Directors.

                   (c)  "OPTION"  shall  mean  rights,  options or  warrants  to
            subscribe  for,  purchase  or  otherwise  acquire  Common  Stock  or
            Convertible Securities.

                                      -3-

                   (d)  "ORIGINAL  ISSUE DATE" shall mean the date this  Warrant
            Certificate was granted.

                   (e)   "PERSON"   shall  mean  an   individual,   partnership,
            corporation,  limited liability company, business trust, joint stock
            company,   trust,   unincorporated   association,   joint   venture,
            governmental authority or other entity of whatever nature.

                   (f) "SECURITIES" shall mean, with respect to any Person, such
            Person's  "securities"  as defined in Section 2(1) of the Securities
            Act,  or any other  debt or equity  securities,  and  includes  such
            Person's  capital  stock or other  equity  interests or any options,
            warrants  or  other  securities  or  rights  that  are  directly  or
            indirectly  convertible  into, or exercisable or  exchangeable  for,
            such Person's capital stock or other equity interests.

                   (g) "ADDITIONAL SHARES OF COMMON STOCK" shall mean all shares
            of Common Stock issued (or, pursuant to SECTION 5.2 below, deemed to
            be issued) by the Company after the Original Issue Date,  other than
            shares of Common Stock issued or issuable:

                       (i) pursuant to the  acquisition of another  corporation,
               directly or indirectly, by the Company by merger, purchase of all
               or  substantially  all  of the  assets  or  other  reorganization
               whereby the Company shall directly or indirectly become the owner
               of 50% or more of the voting power of such corporation;

                       (ii) in connection with any stock split or stock dividend
               of the Company;

                       (iii) pursuant to any public offering;

                       (iv)  pursuant  to the  1993  Stock  Option  Plan  of the
               Company,  the 1998 Stock  Option  Plan of the  Company  and those
               stock  options  listed  on  Schedule  3.1(g)  to  the  Securities
               Purchase Agreement,  dated January 26, 2004 among the Company and
               the purchasers named therein;

               5.2 The  Exercise  Price  specified  in SECTION 4 hereof shall be
subject to adjustment from time to time as follows:

                   (a) ISSUE OF SECURITIES  DEEMED ISSUE OF ADDITIONAL SHARES OF
            COMMON  STOCK.  For  purposes of this SECTION 5.2, if the Company at
            any time or from time to time  after the  Original  Issue Date shall
            issue any Options or  Convertible  Securities  or shall fix a record
            date for the  determination  of holders  of any class of  Securities
            entitled to receive any such Options or Convertible Securities, then
            the  maximum  number of shares of Common  Stock (as set forth in the
            instrument   relating   thereto  without  regard  to  any  provision
            contained  therein  for a  subsequent  adjustment  of  such  number)
            issuable  upon  the  exercise  of such  Options  or,  in the case of
            Convertible  Securities  and Options  therefor,  the  conversion  or
            exchange  of such  Convertible  Securities,  shall be  deemed  to be
            Additional  Shares  of  Common  Stock  issued as of the time of such
            issue or, in case such a record  date shall have been  fixed,  as of

                                      -4-

            the close of business on such record date; provided, that Additional
            Shares of  Common  Stock  shall  not be  deemed to have been  issued
            unless the consideration  per share (determined  pursuant to SECTION
            5.2(c)  hereof) of such  Additional  Shares of Common Stock would be
            less than the Fair Market  Value of the Common  Stock on the date of
            and  immediately  prior to such issue,  or such record date,  as the
            case may be; and provided,  further,  that in any such case in which
            Additional Shares of Common Stock are deemed to be issued:

                       (i) No further  adjustment in the Exercise Price shall be
               made  upon the  subsequent  issue of  Convertible  Securities  or
               shares of Common  Stock  upon the  exercise  of such  Options  or
               conversion or exchange of such Convertible Securities;

                       (ii) If such Options or  Convertible  Securities by their
               terms  provide,  with the passage of time or  otherwise,  for any
               increase in the consideration payable to the Company, or decrease
               in the  number  of  shares of  Common  Stock  issuable,  upon the
               exercise,  conversion  or exchange  thereof,  the Exercise  Price
               computed upon the original  issue thereof (or upon the occurrence
               of a  record  date  with  respect  thereto),  and any  subsequent
               adjustments  based  thereon,  shall,  upon any such  increase  or
               decrease  becoming  effective,  be  recomputed  to  reflect  such
               increase or decrease;

                       (iii) No readjustment pursuant to clause (ii) above shall
               have the  effect of  adjusting  the  Exercise  Price to an amount
               which is less than either (i) the Exercise  Price on the original
               adjustment  date,  or (ii) the  Exercise  Price  that  would have
               resulted from any issuance of  Additional  Shares of Common Stock
               between the original adjustment date and such readjustment date;

                       (iv)   Notwithstanding   clause  (ii)  above,   upon  the
               expiration  or   termination   of  any   unexercised   Option  or
               cancellation of unconverted Convertible Securities,  the Exercise
               Price  shall  be  readjusted  as if such  Option  or  Convertible
               Security had not been issued; and

                       (v) In the event of any  increase in the number of shares
               of  Common  Stock  issuable  upon  the  exercise,  conversion  or
               exchange of any Option or Convertible  Security,  including,  but
               not  limited  to, an  increase  resulting  from the  antidilution
               provisions  thereof  (other  than an increase  resulting  from an
               adjustment pursuant to this SECTION 5.2), the Exercise Price then
               in effect shall forthwith be readjusted to such Exercise Price as
               would have  obtained had the  adjustment  (if any) which was made
               upon the  issuance of such  Option or  Convertible  Security  not
               exercised or converted  prior to such increase been made upon the
               basis  of  such  increased  number  of  shares,  but  no  further
               adjustment  shall be made for the actual issuance of Common Stock
               upon the exercise or conversion of any such Option or Convertible
               Security.

                   (b)  ADJUSTMENT OF EXERCISE PRICE UPON ISSUANCE OF ADDITIONAL
            SHARES OF COMMON  STOCK.  In the event the Company shall at any time
            after the  Original  Issue  Date issue  Additional  Shares of Common
            Stock  (including  Additional  Shares of Common  Stock  deemed to be

                                      -5-

            issued pursuant to SECTION 5.2(a),  but excluding shares issued as a
            dividend or  distribution  as  provided in SECTION  5.2(e) or upon a
            stock split or combination as provided in SECTION  5.2(d)),  without
            consideration  or for a  consideration  per share less than the Fair
            Market Value on the date of and  immediately  prior to such issue (a
            "DILUTIVE  ISSUANCE"),  then and in such event,  the Exercise  Price
            then in effect  shall be adjusted to an Exercise  Price  obtained by
            multiplying the Exercise Price in effect  immediately  prior to such
            issuance by a fraction  obtained by dividing  (i) an amount equal to
            the  sum  of  (w)  the  total  number  of  shares  of  Common  Stock
            outstanding  (including  the  number of shares of Common  Stock into
            which the  outstanding  Warrants are then  convertible)  immediately
            prior  to  such  issuance   multiplied  by  the  Fair  Market  Value
            immediately  prior  to such  issuance,  plus  (x) the  consideration
            received by the Company upon such  issuance,  by (ii) the product of
            (y)  the  sum  of  the  total  number  of  shares  of  Common  Stock
            outstanding  (including  the  number of shares of Common  Stock into
            which the  outstanding  Warrants are then  convertible)  immediately
            prior to such  issuance plus the  Additional  Shares of Common Stock
            issued  and (z) the  Fair  Market  Value  immediately  prior to such
            issuance.

                   (c)  DETERMINATION  OF  CONSIDERATION.  For  purposes of this
            SECTION 5.2, the consideration received by the Company for the issue
            of any  Additional  Shares  of Common  Stock  shall be  computed  as
            follows:

                       (i) CASH AND PROPERTY: Such consideration shall:

                           (x) insofar as it  consists  of cash,  be computed at
                   the aggregate of cash received by the Company

                           (y) insofar as it  consists  of  property  other than
                   cash,  be computed at the fair  market  value  thereof at the
                   time of such issue, as determined in good faith by the Board;
                   and

                           (z) in the event  Additional  Shares of Common  Stock
                   are issued  together with other shares or Securities or other
                   assets of the Company for consideration which covers both, be
                   the proportion of such consideration so received, computed as
                   provided in clauses (x) and (y) above,  as determined in good
                   faith by the Board.

                        (ii)   OPTIONS   AND   CONVERTIBLE    SECURITIES.    The
            consideration  per share  received  by the  Company  for  Additional
            Shares  of Common  Stock  deemed to have  been  issued  pursuant  to
            SECTION  5.2(a),  relating  to Options and  Convertible  Securities,
            shall be determined by dividing

                           (x) the total amount,  if any, received or receivable
                   by the Company as consideration for the issue of such Options
                   or Convertible Securities,  plus the minimum aggregate amount
                   of additional  consideration (as set forth in the instruments
                   relating thereto,  without regard to any provision  contained
                   therein for a subsequent  adjustment  of such  consideration)
                   payable to the Company  upon the  exercise of such Options or

                                      -6-

                   the conversion or exchange of such Convertible Securities, or
                   in the  case  of  Options  for  Convertible  Securities,  the
                   exercise of such Options for  Convertible  Securities and the
                   conversion or exchange of such Convertible Securities, by (y)
                   the maximum number of shares of Common Stock (as set forth in
                   the  instruments  relating  thereto,  without  regard  to any
                   provision  contained  therein for a subsequent  adjustment of
                   such  number)  issuable  upon the exercise of such Options or
                   the conversion or exchange of such Convertible Securities, or
                   in the  case  of  Options  for  Convertible  Securities,  the
                   exercise of such Options for  Convertible  Securities and the
                   conversion or exchange of such Convertible Securities.

                   (d)  ADJUSTMENT  FOR STOCK  SPLITS AND  COMBINATIONS.  If the
            Company  shall at any time or from time to time  after the  Original
            Issue Date effect a subdivision of the outstanding Common Stock, the
            Exercise  Price then in effect  immediately  before the  subdivision
            shall be proportionately increased. If the Company shall at any time
            or from time to time  after the  Original  Issue  Date  combine  the
            outstanding  shares of Common  Stock,  the  Exercise  Amount then in
            effect  immediately  before the combination shall be proportionately
            decreased.   Any  adjustment   under  this  paragraph  shall  become
            effective  at the close of business on the date the  subdivision  or
            combination becomes effective.

                   (e) ADJUSTMENT FOR CERTAIN  DIVIDENDS AND  DISTRIBUTIONS.  In
            the event the Company at any time,  or from time to time,  after the
            Original  Issue Date shall make or issue,  or fix a record  date for
            the determination of holders of Common Stock entitled to receive,  a
            dividend  or other  distribution  payable  in  additional  shares of
            Common  Stock,  then in each such event the  Exercise  Price then in
            effect shall be decreased as of the time of such issuance or, in the
            event such a record date shall have been  fixed,  as of the close of
            business  on such  record  date,  to an amount  equal to the  amount
            determined by  multiplying  the Exercise  Amount then in effect by a
            fraction:

                        (i) the  numerator of which shall be the total number of
            shares of Common Stock issued and outstanding  immediately  prior to
            the time of such  issuance  or the close of  business on such record
            date; and

                        (ii) the  denominator of which shall be the total number
            of shares of Common Stock issued and outstanding  immediately  prior
            to the time of such issuance or the close of business on such record
            date plus the number of shares of Common  Stock  issuable in payment
            of such dividend or distribution.

                   (f) ADJUSTMENTS FOR OTHER DIVIDENDS AND DISTRIBUTIONS. In the
            event  the  Company  at any  time or from  time  to time  after  the
            Original  Issue Date shall make or issue,  or fix a record  date for
            the determination of holders of Common Stock entitled to receive,  a
            dividend or other distribution  payable in Securities of the Company
            or any  Subsidiary or Affiliate  thereof other than shares of Common
            Stock,  then and in each such event  provision shall be made so that
            the Warrantholder  shall receive upon exercise thereof,  in addition
            to the number of shares of Common Stock  receivable  thereupon,  the

                                      -7-

            amount and type of  Securities  that it would have  received had its
            Warrant Certificate been exercised for shares of Common Stock on the
            date of such event and had it thereafter, during the period from the
            date of such  event  to and  including  the  actual  exercise  date,
            retained such Securities  receivable by it as aforesaid  during such
            period giving  application to all adjustments called for during such
            period.

                   (g)   ADJUSTMENT   FOR    RECLASSIFICATION,    EXCHANGE,   OR
            SUBSTITUTION.  If the Common Stock  issuable  upon  exercise of this
            Warrant  Certificate  shall be changed  into the same or a different
            number  of  shares of any class or  classes  of  stock,  whether  by
            capital reorganization, reclassification, or otherwise (other than a
            subdivision or combination of shares of stock dividend  provided for
            above, or a reorganization, merger, consolidation, or sale of assets
            provided for below),  then and in each such event the  Warrantholder
            shall have the right thereafter to exercise this Warrant Certificate
            for the kind and amount of shares of stock and other  Securities and
            property receivable upon such reorganization,  reclassification,  or
            other  change,  by holders  of the number of shares of Common  Stock
            into which this  Warrant  Certificate  was  exercisable  immediately
            prior  to such  reorganization,  reclassification,  or  change,  all
            subject to further adjustment as provided herein.

                   (h) ADJUSTMENT FOR MERGER OR REORGANIZATION,  ETC. In case of
            any  consolidation  or merger of the  Company  with or into  another
            Person or the sale of all or substantially  all of the assets of the
            Company to another Person, this Warrant Certificate shall thereafter
            be  exercisable  for the kind and amount of shares of stock or other
            Securities  or property to which a holder of the number of shares of
            Common  Stock  of the  Company  deliverable  upon  exercise  of this
            Warrant   Certificate   would   have   been   entitled   upon   such
            consolidation,  merger  or  sale;  and,  in such  case,  appropriate
            adjustment  (as determined in good faith by the Board) shall be made
            in the  application of the provisions in this SECTION 5 with respect
            to the rights and interest  thereafter of the Warrantholder,  to the
            end that the  provisions  set  forth in this  SECTION  5  (including
            provisions  with respect to changes in and other  adjustments of the
            Exercise  Amount) shall  thereafter be applicable,  as nearly as may
            be, in relation to any shares of stock or other property  thereafter
            deliverable upon exercise of this Warrant Certificate.

                   (i) ADJUSTMENT IN EXERCISE  AMOUNT.  Upon each  adjustment in
            the Exercise Price pursuant to the provisions of this SECTION 5, the
            Exercise  Amount  then in effect  shall be  adjusted  to an Exercise
            Amount obtained by multiplying the Exercise Amount immediately prior
            to such  adjustment  by a fraction,  the numerator of which shall be
            the Exercise  Price  immediately  prior to such  adjustment  and the
            denominator of which shall be the adjusted Exercise Price.

                   (j) NO IMPAIRMENT.  The Company will not, by amendment of its
            Certificate of Incorporation or through any reorganization, transfer
            of  assets,  consolidation,  merger,  dissolution,  issue or sale of
            Securities or any other voluntary action, avoid or seek to avoid the
            observance  or  performance  of any of the terms to be  observed  or
            performed  hereunder  by the  Company  but will at all times in good
            faith  assist  in the  carrying  out of all the  provisions  of this
            SECTION 5 and in the taking of all such  action as may be  necessary

                                      -8-

            or  appropriate  in order to  protect  the  exercise  rights  of the
            Warrantholder against impairment.

                   (k) CERTIFICATE AS TO AMENDMENTS. Upon the occurrence of each
            adjustment or  readjustment  of the Exercise  Price pursuant to this
            SECTION 5, the Company at its expense  shall  promptly  compute such
            adjustment or  readjustment in accordance with the terms thereof and
            furnish  to each  Warrantholder  a  certificate  setting  forth such
            adjustment  or  readjustment  and  showing  in detail the facts upon
            which such adjustment or  readjustment is based.  The Company shall,
            upon the written request at any time of any  Warrantholder,  furnish
            or cause  to be  furnished  to such  holder  a  similar  certificate
            setting  forth  (i) such  adjustments  and  readjustments,  (ii) the
            Exercise  Price and  Exercise  Amount then in effect,  and (iii) the
            number of shares of Common  Stock and the  amount,  if any, of other
            property  which then would be received upon exercise of this Warrant
            Certificate.

                   (l) NOTICE OF RECORD DATE. In the event:

                       (i) that the  Company  declares a dividend  (or any other
            distribution)  on its Common Stock  payable in Common Stock or other
            Securities of the Company;

                       (ii)  that  the  Company   subdivides   or  combines  its
            outstanding shares of Common Stock;

                       (iii) of any  reclassification of the Common Stock of the
            Company (other than a subdivision or combination of its  outstanding
            shares of Common  Stock or a stock  dividend  or stock  distribution
            thereon),  or of any  consolidation or merger of the Company into or
            with another corporation, or of the sale of all or substantially all
            of the assets of the Company; or

                       (iv)  of  the   inventory   or   voluntary   dissolution,
            liquidation or winding up of the Company;

            then the Company shall cause to be filed at its principal  office or
            at the office of the transfer  agent of the Common Stock,  and shall
            cause to be mailed to the  Warrantholder  at their last addresses as
            shown on the records of the Company or such transfer agent, at least
            15 days prior to the record date  specified  in (A) below or 30 days
            before the date specified in (B) below, a notice stating

                             (A) the record date of such dividend, distribution,
               subdivision or  combination,  or, if a record is not to be taken,
               the date as of which the holders of Common  Stock of record to be
               entitled  to  such   dividend,   distribution,   subdivision   or
               combination are to be determined, or

                             (B)  the  date  on  which  such   reclassification,
               consolidation,  merger, sale, dissolution, liquidation or winding
               up is expected to become  effective,  and the date as of which it
               is  expected  that  holders  of Common  Stock of record  shall be
               entitled to exchange  their shares of Common Stock for Securities

                                      -9-

               or  other  property   deliverable  upon  such   reclassification,
               consolidation, merger, sale, dissolution or winding up.

            6. EXCHANGE AND REPLACEMENT OF WARRANT CERTIFICATE.

               6.1 On surrender for exchange of this Warrant Certificate, or any
Warrant Certificate or Warrant  Certificates issued upon subdivision,  exercise,
or transfer in whole or in part of this Warrant Certificate,  properly endorsed,
to the  Company,  the Company at its expense will issue and deliver to or on the
order of the holder thereof a new Warrant Certificate or Warrant Certificates of
like  tenor,  in the name of such  holder or as such  holder (on payment by such
holder of any applicable transfer taxes) may direct, calling in the aggregate on
the face or faces thereof for the number of shares of Common Stock called for on
the  face or  faces  of the  Warrant  Certificate  or  Warrant  Certificates  so
surrendered.

               6.2  In  the  event  this  or  any  subsequently  issued  Warrant
Certificate  is lost,  stolen,  mutilated or  destroyed,  the Company may,  upon
receipt  or  a  proper  affidavit  (and  surrender  of  any  mutilated   Warrant
Certificate) and an indemnity agreement or security  reasonably  satisfactory in
form and amount to the Company, in each instance protecting the Company, issue a
new  Warrant  Certificate  of like  denomination,  tenor and date as the Warrant
Certificate  so lost,  stolen,  mutilated  or  destroyed.  Any such new  Warrant
Certificate shall constitute an original contractual  obligation of the Company,
whether or not the  allegedly  lost,  stolen,  mutilated  or  destroyed  Warrant
Certificate shall be at any time enforceable by anyone.

            7. ELIMINATION OF FRACTIONAL INTERESTS.

               7.1 The  Company  shall  not  issue  any  fraction  of a share in
connection with the exercise of this Warrant Certificate,  but in any case where
the  Warrantholder  would,  except  for the  provisions  of this  SECTION  7, be
entitled under the terms of this Warrant  Certificate to receive a fraction of a
share upon the exercise of this Warrant Certificate, the Company shall, upon the
exercise of the Warrant  Certificate  for the largest number of full shares then
called for thereby and receipt of the Exercise Price thereof,  pay a sum in cash
equal to the Fair Market Value of such  fraction of a share on the day preceding
such  exercise.  The  Warrantholder  expressly  waives its rights to receive any
fraction of a share or a Warrant  Certificate  representing  a fractional  share
upon exercise thereof.

               7.2 If the taking of any action would cause an  adjustment in the
Exercise  Price so that the  exercise  of this  Warrant  Certificate  while such
Exercise  Price is in effect  would  cause  shares to be issued at a price below
their  then par  value,  the  Company  will  take  such  action  as may,  in the
reasonable opinion of its counsel, be necessary in order that it may validly and
legally  issue  fully  paid and  nonassessable  shares of Common  Stock upon the
exercise of this Warrant Certificate.

            8. RESERVATION AND LISTING OF SHARES.

            The Company will cause to be reserved and kept  available out of its
authorized  and  unissued  shares of Common  Stock the number of whole shares of
Common  Stock  sufficient  to  permit  the  exercise  in full  of  this  Warrant
Certificate.

                                      -10-

            9. RIGHTS OF WARRANTHOLDER.

               9.1 The  Company may deem and treat the person in whose name this
Warrant Certificate is registered with it as the absolute owner for all purposes
whatever  (notwithstanding  any notation of ownership or other  writing  thereon
made by anyone other than the Company) and the Company  shall not be affected by
any notice to the contrary. The terms "Warrantholder" and "holder of the Warrant
Certificate"  and all other  similar  terms  used  herein  shall  mean only such
person(s) in whose name(s) this Warrant  Certificate  if properly  registered on
the Company's books. However,  notwithstanding the foregoing,  no person, entity
or group may  become a  Warrantholder  other than the  Warrantholder  unless and
until (a) the  provisions of SECTION 3.1 hereof have been complied with, (b) the
Company has received an assignment transferring all right, title and interest in
and to this Warrant Certificate, and (c) such person, entity or group represents
and  warrants  in writing  that it will be the sole legal and  beneficial  owner
thereof.

            10. REGISTRATION RIGHTS.

               10.1 The  Warrantholder  has  certain  registration  rights  with
respect to the Warrant Shares as set forth in the Registration  Rights Agreement
between the Company and the Warrantholder, dated as of January 30, 2004.

            11. NOTICES.

            Any notice or demand  authorized by this Warrant  Certificate  to be
given or made by the  Warrantholder  to or on the Company or to be given or made
by the Company to or on the Warrantholder shall be sufficiently given or made if
sent in writing by first-class mail, postage prepaid, addressed as follows:

                  (a) If to the Warrantholder, to the address for such holder as
            shown on the books of the Company; or

                  (b) If to the Company, to:

                      Empire Resorts, Inc.
                      c/o Monticello Raceway
                      Route 17 B
                      P.O. Box 5013
                      Monticello, New York 12701

or at such other address as the  registered  holder or the Company may hereafter
have advised the other.

            12. SUCCESSORS.

            All  the  covenants,  agreements,   representations  and  warranties
contained in this Warrant  Certificate  shall bind the parties  hereto and their
respective  heirs,  executors,  administrators,   distributees,  successors  and
assigns.

                                      -11-

            13. HEADINGS.

            The Section headings in this Warrant  Certificate have been inserted
for purposes of convenience only and shall have no substantive effect.

            14. LAW GOVERNING.

            This Warrant  Certificate  is delivered in the State of New York and
shall be construed and enforced in accordance with, and governed by, the laws of
the State of New York  (without  giving effect to the choice of law principle of
such  state),  regardless  of the  jurisdiction  of  creation or domicile of the
Company or its successors or of the holder at any time hereof.

            15. REMEDIES.

            The  Company  stipulates  that the  remedies at law of the holder of
this Warrant  Certificate  in the event of any default or threatened  default by
the Company in the  performance  of or compliance  with any of the terms of this
Warrant Certificate are not and will not be adequate, and that such terms may be
specifically  enforced by a decree for the specific performance of any agreement
contained  herein or by an  injunction  against a violation  of any of the terms
hereof or otherwise.

                                       12

            IN  WITNESS   WHEREOF,   the  Company  has  executed   this  Warrant
Certificate  by its duly  authorized  officer as of the day and year first above
written.

                                     EMPIRE RESORTS, INC.

                                     By:
                                        ----------------------------------------
                                        Name:
                                        Title:

                                      -13-

                                SUBSCRIPTION FORM

                      (To Be Executed By The Warrantholder
                  In Order to Exercise The Warrant Certificate)

            The undersigned,  pursuant to the provisions set forth in the within
Warrant Certificate, hereby irrevocably elects to exercise the right to purchase
________ shares of Common Stock of Empire Resorts,  Inc. covered by such Warrant
Certificate,  and  herewith  tenders  _________  having a fair  market  value of
$________  in full  payment of the  Exercise  Price for such  shares  (which may
include  foregoing  receipt of ___ shares of Common  Stock as per Section 1.1 of
the Warrant Certificate).

                                            By:
                                               ---------------------------------
                                               Signature

                                               ---------------------------------
                                               Name

                                               ---------------------------------
                                               Address

                                               ---------------------------------

            Dated: ________________________

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00063-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00063-of-00352.parquet"}]]