Exhibit 8.1
December 12, 2003
Transferors (and their direct and indirect owners)
as defined in
the Securities Contribution
Agreement dated as of
the date hereof
Re: Amended and Restated Securities Contribution Agreement
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Dear Sirs and Madams:
We have served as counsel to Empire Resorts, Inc. (the "Company"), in
connection with the proposed contribution pursuant to that Amended and Restated
Securities Contribution Agreement, of even date herewith (the "Agreement"),
which provides for the contribution (the "Contribution") of Interests by the
Transferors for shares of common stock of the Company to be issued by the
Company. Our opinion has been requested with respect to certain federal income
tax consequences of the Transaction in our capacity as counsel to the Company.
In rendering this opinion, we have examined (i) the Internal Revenue
Code of 1986, as amended ("Code") and Treasury regulations, (ii) the legislative
history of applicable sections of the Code and (iii) appropriate Internal
Revenue Service and court decisional authority. In addition, we have relied upon
certain information made known to us as more fully described below. All
capitalized terms used herein without definition shall have the respective
meanings specified in the Agreement, and, unless otherwise specified, all
section references herein are to the Code.
INFORMATION RELIED UPON
In rendering the opinions expressed herein, we have examined:
1. The Agreement;
2. The Tax Certificates dated as of the date hereof and attached
hereto as Exhibit A (the "Certificates"); and
December 12, 2003
Page 2
3. The Company's audited financial statements for the fiscal year
ended December 31, 2002.
In addition, we have made such examination of law and have examined
such certificates, documents, records and opinions as we have deemed necessary
for the purposes of this opinion. In our examination of the documents and as a
basis for the opinions herein set forth, we have assumed that all documents
submitted to us as photocopies faithfully reproduce the originals thereof, that
such originals are authentic, the genuineness of all signatures, that all such
documents have been or will be duly executed to the extent required, that all
statements set forth in such documents are accurate and that the transactions
contemplated by the Agreement will be consummated in accordance therewith. This
opinion expressly assumes that (a) none of the Interests are interests in U.S.
real property or U.S. real property holding companies within the meaning of
Section 897 of the Code, (b) that the Transferors will, as a result of and
following the Contribution own at least 80% of the total combined voting power
of all classes of stock entitled to vote and at least 80% of all other classes
of stock* and (c) any cash received by the Transferors pursuant to the indemnity
set forth in Section 9.3 of the Agreement is independent of and severable from
the Contribution.
We have also obtained such additional information and representations
as we have deemed relevant and necessary through consultation with various
officers and representatives of the Company and through the above referenced
Certificates.
We have been advised that the Board of Directors of the Company has
determined that, among other things, the Transaction is in furtherance of and
consistent with the Company's long-term business strategies.
OPINIONS
On the basis of the foregoing and the representations contained in the
Agreement and the Certificates, we are of the opinion that under presently
applicable federal income tax law:
1. The transfer of the Interests by the Transferors to Empire in
exchange for the Exchange Shares will constitute a tax-free exchange within the
meaning of Section 351 of the Code;
2. No gain or loss for U.S. federal income tax purposes will be
recognized by Empire as a result of the Contribution;
3. No gain or loss for federal income tax purposes will be recognized
by the Transferors (and their direct and indirect owners) upon the receipt of
the Company's common stock solely in exchange for their respective
contributions; and
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* We understand that in an unrelated transaction, the Series E Preferred Stock
received one vote per four shares, representing approximately 2% of the total
combined voting power.
December 12, 2003
Page 3
4. The Exchange Shares will not be "United States real property
interests" within the meaning of Code Section 897(c)(1)(A) of the Code
immediately after the Closing Time; and
5. No gain or loss for federal income tax purposes will be recognized
by Xxxxxxx Xxxxxx upon a subsequent resale of the Exchange Shares, assuming that
(i) Xx. Xxxxxx was never a citizen of the United States, and is and will
continue to be a nonresidential alien individual within the meaning of Section
7701(b) of the Code; (ii) Xx. Xxxxxx is not present within the United States for
a period or periods aggregating 183 days or more during the taxable year of the
resale; (iii) gain or loss attributable to the resale is not effectively
connected with the conduct of a trade or business within the United States; and
(iv) the Exchange Shares are not "United States real property interests" within
the meaning of Code Section 897(c)(1)(A) of the Code, unless the exception set
forth in Section 897(c)(3) of the Code is applicable.
CONCLUSION
The opinions expressed herein are based upon existing statutory,
regulatory and judicial authority, any of which may be changed at any time with
retroactive effect. In addition, our opinions are based solely on the documents
that we have examined, the additional information that we have obtained, and the
statements set out in the Certificates, which we have assumed are true on the
date hereof and will be true on the date on which the Transaction is
consummated. Our opinions cannot be relied upon if any of the facts pertinent to
the federal income tax treatment discussed herein, as stated in such documents
are, or later become, inaccurate, or if such additional information is, or later
becomes, inaccurate, or if any of the statements set out in the Certificates
are, or later become, inaccurate.
Finally, our opinions are limited to the federal income tax matters
specifically covered thereby, and we have not been asked to address, nor have we
addressed, any other tax consequences of the Transaction.
This opinion is being provided solely for your benefit. No other
person or party shall be entitled to rely on this opinion.
/s/ XXXXXX XXXXXXXX FROME XXXXXXXXXX & XXXXXXX LLP
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XXXXXX XXXXXXXX FROME XXXXXXXXXX & XXXXXXX LLP
