Veteran and Fraternal Organizations: New Product Trends January 10, 2014 Presented by: Chris Robertson Director of Business Development

AGENDA I.Traditional Products II.Gray Machines III.New Trends

TRADITIONAL PRODUCTS

GRAY MACHINES Prevalent in many states Undocumented number of machines – in the hundreds of thousands New laws leading to machine seizures

NEW TRENDS To support Veteran and Fraternal organizations, regulators are approving regulated alternative products Several states are following with this trend

NEW TRENDS: DELAWARE Late 2012 veterans’ groups and fraternal organizations told to stop illegal slot operations Law passed early 2013 to allow slot machines Active since May 2013

NEW TRENDS: MISSOURI Pull-tabs discontinued in 2010 Replaced with scratchers, a more secure product, and Keno Demand brought back pull-tabs Oct 2013 Electronic pull-tab dispenser Improved security and accounting

NEW TRENDS: OHIO Veterans’ halls under scrutiny for gray machines Lottery offering new product Chosen product questioned by AG at this time and rejected by organizations Intention is to provide regulated alternative

NEW TRENDS: MARYLAND The law grandfathered machines on eastern shore, allowing slot machines in veteran and fraternal halls Leaves out the Veteran and Fraternal organizations in rest of state Aug 2012 new law authorized lottery to provide Veterans’ halls with ITVMs with video displays

NEW TRENDS: NEW MEXICO NM Gaming Control Board looking for additional support of charities Approved modernized pull-tab ticket dispenser Launched in May 2013

NEW TRENDS: FLORIDA Pull-tabs approved in AG Opinion against pull-tab dispensers Historically, amusement games permitted HB155 restricts video products Compact does not permit electronically- assisted pull-tabs or similar Lottery products

WHAT CAN YOUR STATE DO?