Dear Valued Kentucky Customer,

First of all, we want to sincerely thank you for your business and for the opportunity to partner with you in helping the charities and fraternal organizations of Kentucky to prosper. We are particularly excited about the new opportunities to bring you even more entertaining gaming experiences under the new regulations that become effective in the coming weeks. However, it has recently come to our attention that a newcomer to the electronic charitable gaming industry in Kentucky has been intentionally spreading misinformation about us in the Commonwealth of Kentucky.

The purpose of this letter is to clear up any confusion that may have been caused by their disinformation campaign. Grover Gaming (Grover) has two “sister” companies, G2 Gaming, Inc. (G2) and Banilla Games, Inc. (Banilla). As you know, G2 is the distributor for Grover in Kentucky. The regulations require that Grover deals with a second company as its distributor, even if that second company has similar ownership. Banilla sells and distributes “skill games,” mostly in the State of Georgia where skill games are licensed and regulated by the Georgia Lottery Corporation. Neither Grover nor Banilla place or operate any skill games in any jurisdiction. Banilla sells skill games outright to game operators. Banilla Games has not sold any games into Kentucky. Banilla Games will not sell any games to anyone whom it believes will take those games to Kentucky.

The current influx of skill games into Kentucky is the work of a company called Pace-O-Matic who claim that their games are legal in the Commonwealth. They do business in Kentucky under the trade name “Burning Barrel.” Pace-O-Matic has been operating skill games in Kentucky since at least 2021. See Courtney King, “How these new gaming machines skirt Kentucky’s gambling laws,” June 17, 2021; available at https://www.fox19.com/2021/06/18/how-these-new-slot-machines-skirt-kentuckys-gambling-laws/.

Pace-O-Matic’s skill games, also called “gray machines” because they are unregulated in Kentucky, are found in, among other places, convenience stores. See Steve Bittenbender, “Gray Games Ban Weighed in Kentucky, Pace-O-Matic Gives $125K to Police Charity,” Mar. 17, 2022; available at https://www.casino.org/news/as-kentucky-lawmakers-weigh-gray-games-ban-pace-o-matic-donates-125k-to-fop.

As of March 2022, Pace-O-Matic had 900 machines across 42 Kentucky counties. See Rachel Droze, “Lawmakers believe ‘gray machine’ manufacturers took advantage of legal loophole,” Mar. 4, 2022 (Pace-O-Matic began operating in Kentucky in February 2021); available at https://www.whas11.com/article/news/kentucky/skill-based-gaming-gray-machines-kentucky-illegal-state-law-lottery/417-60c1c54b-dc93-43e6-bcd5-b3ee2b056685.

Since at least March 2022, Pace-O-Matic has been actively lobbying the Kentucky legislature in an attempt to protect its massive presence in Kentucky. See The Lane Report, “Legislators continue to consider gray machines,” Nov. 18, 2022; available at https://www.lanereport.com/160935/2022/11/legislators-continue-to-consider-gray-machines/.

Because Grover Gaming is very invested in Charitable Gaming in Kentucky we have worked very hard against the proliferation of skill games there. We have been more than just a vocal opponent of skill games in Kentucky for multiple years. Grover is a member of both the Kentuckians Against Illegal Gambling and Allied Charities of Kentucky organizations. Through our membership and support of these organizations, along with our own independent legislative efforts, we are working to close the perceived legal loophole being exploited by skill game manufacturers in Kentucky.

Just as we tried to legislatively ban skill games during the last session of the General Assembly, we are working every day of this current legislative session to rid Kentucky of these gray machines. So, hopefully it is clear that we did not start the current mess with gray games in Kentucky and have been working diligently to stop the proliferation of those games. Thank you again for your loyal business and if you have any questions or concerns, please do not hesitate to call myself directly at (252) 258-0366 or Jimmy Forrest, Vice President of Sales for Grover Gaming, at (804) 517-9079.

Wishing you a profitable New Year!

Sincerely,
Garrett Blackwelder
Owner/CEO