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STATE OF MICHIGAN MICHIGAN ADMINISTRATIVE HEARING SYSTEM MICHIGAN GAMING CONTROL BOARD, PETITIONER, ACES GAMING SUPPLY, LLC, RESPONDENT. Docket No.: 13-008798-TREAS Case No.: W29200 Agency: Treasury Case Type: Treas MGCB Filing Type: Renewal of Supplier License/Revocation Marc Corriveau (P58510) Kelley Cawthorne Attorney for Respondent 208 N. Capitol Ave., Floor 3 Lansing, MI 48933 517-371-1400 Thomas Nafso (P73721) Bethany Scheib (P47672) Assistant Attorneys General Attorneys for Petitioner Alcohol & Gambling Enforcement Div. PO Box 30736 Lansing, MI 48909 517-241-0210 RELEASE AND SETTLEMENT AGREEMENT This Release and Settlement Agreement ("Agreement") is entered into by Aces Gaming Supply, LLC ("Aces"), a Michigan Limited Liability Company, and by Richard S. Kalm, Executive Director of the Michigan Gaming Control Board (" MGCB"), referred to collectively as the Parties, this day of , 2014. RECITALS 1. Aces is a licensed supplier under the Bingo Act and rules promulgated thereto. MCL 432.101 et seq. Aces provides gaming equipment and services to qualified organizations conducting licensed "millionaire parties" as defined in the Bingo Act and rules. 2. As a result of an investigation of Aces' application for renewal of its supplier license, MGCB believed Aces was involved directly or indirectly with the rental or leasing of a facility used for an event in violation of MCL 432.111b(10).

Settlement Agreement

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Settlement between the Michigan Gaming Board and Aces Gaming Supply.

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Page 1: Settlement Agreement

STATE OF MICHIGANMICHIGAN ADMINISTRATIVE HEARING SYSTEM

MICHIGAN GAMING CONTROL BOARD,

PETITIONER,

ACES GAMING SUPPLY, LLC,

RESPONDENT.

Docket No.: 13-008798-TREAS

Case No.: W29200

Agency: Treasury

Case Type: Treas MGCB

Filing Type: Renewal ofSupplier License/Revocation

Marc Corriveau (P58510)Kelley CawthorneAttorney for Respondent208 N. Capitol Ave., Floor 3Lansing, MI 48933517-371-1400

Thomas Nafso (P73721)Bethany Scheib (P47672)Assistant Attorneys GeneralAttorneys for PetitionerAlcohol & Gambling Enforcement Div.PO Box 30736Lansing, MI 48909517-241-0210

RELEASE AND SETTLEMENT AGREEMENT

This Release and Settlement Agreement ("Agreement") is entered into byAces Gaming Supply, LLC ("Aces"), a Michigan Limited Liability Company, and byRichard S. Kalm, Executive Director of the Michigan Gaming Control Board("MGCB"), referred to collectively as the Parties, this day of , 2014.

RECITALS

1. Aces is a licensed supplier under the Bingo Act and rules promulgated thereto.MCL 432.101 et seq. Aces provides gaming equipment and services to qualifiedorganizations conducting licensed "millionaire parties" as defined in the BingoAct and rules.

2. As a result of an investigation of Aces' application for renewal of its supplierlicense, MGCB believed Aces was involved directly or indirectly with the rentalor leasing of a facility used for an event in violation of MCL 432.111b(10).

Page 2: Settlement Agreement

3. MGCB sent a Notice of Opportunity to Show Compliance to Aces on June 7,2013. A compliance conference was held on July 30, 2013. The conferenceafforded Aces an opportunity to respond to the alleged violations set forth in theNotice of Opportunity to Show Compliance, and demonstrate compliance withthe Bingo Act and its rules.

4. After not resolving the matter at the compliance conference, and in accordancewith the Bingo Act, its rules, and the Administrative Procedures Act,MCL 24.201 et seq., the MGCB initiated disciplinary action against Aces by filinga complaint with the Michigan Administrative Hearing System. In Counts 1, 2,and 3, it was alleged that Aces acted contrary to MCL 432.111b(10) by payingTrippers, Northville Downs, and Douglas Management & InvestmentCo., part of its proceeds from charitable gaming. Count 4 alleged that by virtue ofCounts 1, 2, and 3 Mich. Admin Code, R 432.21103 and Rule 432.21804(1)(a) wereviolated.

5. A two-day hearing was held in November and December 2013. AdministrativeLaw Judge ("AU") Cohen issued a Proposal for Decision ("PFD") on March 11,2014. AUJ Cohen determined that the MGCB met its burden of proof as toCounts 1, 2, and 4 of the complaint.

6. Exceptions were filed by the Parties and the record was transmitted to theMGCB for a final decision; however, prior to the issuance of a final decision, theParties have agreed to resolve the matter in accordance with the followingterms.

RELEASE AND SETTLEMENT

7. Aces acknowledges that it operated contrary to the Bingo Act by being involveddirectly or indirectly with the rental or leasing of a facility used for an event inviolation of MCL 432.111b(10).

8. Aces acknowledges that by violating MCL 432.111b(10) it has also violated Rule432.21103 and Rule 432.21804(1)(a).

9. Aces agrees to a thirty (30) consecutive calendar day suspension of its supplier'slicense. The date of suspension will be determined by the MGCB, but will notcommence until at least two weeks' notice is provided to Aces, unless an earlierdate is mutually agreed upon by the Parties. ("Suspension Period"). During theSuspension Period, Aces, and specifically, any owner, shareholder, partner,officer, or agent of Aces, shall not provide any goods or services as a supplier to

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any individuals or entities. Aces shall not receive any compensation during theSuspension Period for activities related to its business as a supplier; nor shall itreceive any compensation before or after the Suspension Period for activitiesrelated to its business as a supplier that take place during the SuspensionPeriod.

10. Pursuant to this agreement, the MGCB agrees to grant Aces' renewal of itssupplier's license. This grant is subject to compliance with all provisions of theBingo Act and rules and by agreeing to grant the renewal of Aces' supplierlicense, the MGCB is not waiving any right to take action against Aces for anyviolations of the Bingo Act and its rules that are not subject to this matter.Aces agrees and understands that the license granted pursuant to this provisionwill expire as otherwise provided for by the Bingo Act and rules, unless Acesseeks to renew its license as provided for in the Bingo Act and rules.

11.During the Suspension Period, MGCB agrees to process applications fromqualified organizations proposing to use Aces as their supplier for eventsscheduled after the Suspension Period. Applications will be processed in theordinary manner, which includes but is not limited to, qualified organizationshaving applications submitted at least six weeks prior to the event date. Theapplications will be processed and decided upon in accordance with the BingoAct and rules.

12.MGCB reserves the right, within its sole discretion, to grant or deny licenses toqualified organizations for millionaire parties.

13.In executing this Agreement, Aces agrees to release MGCB, the ExecutiveDirector, and its employees or agents of any liability related to this matter.Further, Aces voluntarily waives any rights to appeal this agreement to anycourt or otherwise in regards to this matter.

14.Aces accepts this Agreement as a complete compromise of all outstandinglitigation and disputed issues of law and fact relating to MichiganAdministrative Hearing System, Docket No. 13-008798-TREAS.

15.This Agreement is subject to full compliance with the Bingo Act, rules anddirectives as are currently in effect or that may be amended or changed byoperation of law in the future.

16.The Parties agree that this Agreement is fully integrated, represents the entireunderstanding of the Parties, and that there are no other agreements,representations, promises, or negotiations that have not been expresslyembodied herein.

17.If any provision of this Agreement is prohibited by law or judged by a court to beunlawful, void or unenforceable, the provision shall, to the extent required, be

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severed from this Agreement and rendered ineffective as far as possible withoutmodifying the remaining provisions of this Agreement, and shall not in any wayaffect any other circumstances, or the validity or enforcement of this Agreement.

18.Aces assumes the risk that the facts or the law may be otherwise than believedwhen they entered into this Agreement.

By signing below the Parties agree that they have reviewed with counsel,understand, and voluntarily agree to all of the above terms and conditions with fulland competent consent and authority.

on Datebehalf of Aces Gaming Supply, LLC, Respondent

Richard S. Ka1m, Executive Director, DateMichigan Gaming Control Board,Petitioner

I have reviewed the above terms and conditions with my client as evidenced by mysignature below.

Marc Corriveau, Attorney for Respondent Date

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