Letter Agreement Extension and Site Relocation for Casino Development – Empire Resorts, Inc., Cayuga Nation of New York, and Cayuga Catskill Gaming Authority

 Exhibit 10.1 EMPIRE ------------------------------------------------------------------ RESORTS, INC. 204 STATE ROUTE 17B MONTICELLO, NY 12701 PHONE: (845) 807-0001 FAX: (845) 807-0000 December 19, 2005 Cayuga Nation of New York P.O. Box 250 Hamburg, New York 14075-0250 Attention: Gary Wheeler Cayuga Catskill Gaming Authority c/o Cayuga Nation of New York P.O. Box 250 Hamburg, New York 14075-0250 Attention: Tim Twoguns Gentlemen, On June 29, 2005, representatives of the Cayuga Nation of New York (the "Nation") and the Cayuga Catskill Gaming Authority (the "Authority") met with representatives of Empire Resorts, Inc.("Empire") and agreed to extend the Land Purchase Agreement and the April 3, 2003 Letter Agreement (as previously amended pursuant to the First Amendment of Letter Agreement) relating to the development of a casino on land within the Monticello Raceway site to December 31, 2005 (such agreement as amended to date referred to herein as the "Letter Agreement"). In addition, on July 22, 2005, representatives of the Nation, the Authority and Empire further agreed to a potential change in the location of the Cayuga Catskill Resort to a larger site to include more land over which the Nation could exercise governmental authority. In return, the Nation agreed to allow Empire to work with the St. Regis Mohawk Tribe to return to the Raceway site and obtain the remaining approvals necessary to build a resort casino. The Letter Agreement is expiring. Unfortunately, our efforts to move forward on the Cayuga Project have been frustrated by a number of factors including the 2nd Circuit Court of Appeals decision dismissing the Nation's land claims, the continuing internal disputes among leadership factions within the Nation, and a New York legislative stalemate. Thus, we have not been able to move forward with the necessary Federal and State approvals to accomplish our goals within the extension date of December 31, 2005. - -------------------------------------------------------------------------------  - ------------------------------------------------------------------------------- 204 STATE ROUTE 17B MONTICELLO, NY 12701 PHONE: (845) 807-0001 FAX: (845) 807-0000 The purpose of this letter is to signify our mutual desire and agreement to continue to work with the Nation and the Authority to develop a casino resort and hotel at the Concord site or on such other suitable property that Empire Resorts currently owns, may acquire in the future or may acquire rights to develop. In addition, and as previously agreed, this letter will also confirm our agreement to terminate any arrangement with the Nation respecting hotels and commercial facilities in, around and near the Raceway site. It is further acknowledged that the reimbursement by Empire of all future costs and expenses of the Nation in connection with the acquisition and development of the Property shall be subject to the reasonable concurrence of Empire. By signing this letter, the parties acknowledge a mutual agreement to move forward on this basis. Upon the determination of a new site the parties hereto will seek to revise all related agreements to conform to the new site, including the dates of performance and or termination of relevant documents. We believe that a realistic time frame given the current political climate is 12 months, and as such we request that the extension expire, unless extended by mutual agreement of the parties, on December 31, 2006. If the terms described herein properly reflect your understandings and you agree to accept the terms, please sign in the respective spaces provided for the Nation and the Authority below. Thank you for your support of the Project. We look forward to continuing our relationship with the Cayuga Nation to develop a premier resort hotel and casino in the Catskills. For Empire Resorts, Inc.: /s/ David P. Hanlon -------------------------- David P. Hanlon, President & Chief Executive Officer ACKNOWLEDGED AND AGREED: CAYUGA NATION OF NEW YORK BY: /s/ Timothy Twoguns ------------------------------------------- Timothy Twoguns, Turtle Clan Representative - --------------------------------------------------------------------------------  - ------------------------------------------------------------------------------- 204 STATE ROUTE 17B MONTICELLO, NY 12701 PHONE: (845) 807-0001 FAX: (845) 807-0000 By: /s/ Gary Wheeler ----------------------------------------- Gary Wheeler, Turtle Clan Representative By: /s/ Michael W. Wheeler ----------------------------------------- Michael W. Wheeler, Heron Clan Member CAYUGA CATSKILLL GAMING AUTHORITY BY: /s/ Timothy W. Twoguns ---------------------------------------- Timothy W. Twoguns, Member MONTICELLO RACEWAY MANAGEMENT, INC. BY: /s/ David P. Hanlon ---------------------------------------- David P. Hanlon - -------------------------------------------------------------------------------