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Kentucky Lottery Contract For MDI'S Harley-Davidson Promotion

11 April 2000

Kentucky Lottery Corp Cranks Up Contract For MDI'S Harley-Davidson Game Promotion; First Business for MDI in the Bluegrass State

    HARTFORD, Conn.--April 11, 2000--Lottery players in Kentucky will soon have the chance to win much-sought-after Harley-Davidson(R) motorcycles and other officially licensed Harley(R) merchandise under the terms of a contract with MDI Entertainment, Inc. (OTC BB:MDIH), the company announced today.
    The contract is MDI's first ever with the Kentucky Lottery Corporation. The $3 Harley-Davidson(R) instant scratch-off lottery game is slated to go on sale by June 1. The contract is expected to generate gross revenue of $328,000 for MDI, depending on ticket sales and prizes awarded.
    "We're very excited about bringing Harley-Davidson(R) to Kentucky Lottery players as part of the Lottery's instant ticket marketing program," said Steve Saferin, President and CEO of MDI. "The Lottery has created what we believe is an excellent promotion around the world renowned Harley brand and we look forward to a roaring success."
    The Kentucky contract is the 23rd MDI Harley-Davidson(R) promotion conducted, in progress, or announced for this year in lottery jurisdictions throughout North America, since MDI began offering the property in 1998.
    Kentucky's initial order is for 1.8 million Harley-Davidson(R) lottery tickets, with the option to order more. Scientific Games International will print the tickets. Scientific Games and MDI have a strategic business alliance that provides marketing support for MDI's licensed lottery products. Scientific Games also made an investment in MDI.
    Up to eight Harley-Davidson(R) Sportster 1200 Custom motorcycles will be awarded. Each motorcycle prize is valued at $16,000 and includes all related taxes and fees. Additionally, players will have the opportunity to win more than $3.4 million in cash prizes of $3, $5, $6, $10, $15, $20, $30, $60, $100, $16,000 and $30,000.
    Players will have the chance to win motorcycles instantly, and also in second chance drawings that will include other Harley-Davidson(R) merchandise prizes. Eight drawings are planned during the promotion. More than 4,000 other merchandise prizes will be awarded to players who enter the drawings by sending two non-winning Kentucky Lottery Harley-Davidson(R) tickets to a special drawing address. MDI will provide all drawing and merchandise prize fulfillment services in the promotion.

    MDI specializes in creating, marketing and implementing entertainment-based promotions on behalf of the North American lottery industry. MDI revolutionized the lottery industry with its introduction of second-chance merchandise prizes. MDI's current lottery promotions include scratch games featuring other properties such as Harley-Davidson(R), Wheel of Fortune(R), Jeopardy!(R), Betty Boop(TM), Twilight Zone(TM), Louisville Slugger(R), TNN(R), CMT(R), Hummer(R), (Ray Charles(R),of course), James Bond 007(R), Pink Panther(TM), The Outer Limits(TM), Heroes of Space(TM), Michael Buffer's Let's Get Ready To Rumble(R), Dick Clark's American Bandstand(R), Times Square 2000(TM), SPAM(R), Greatest Sports Legends and auto race drivers Dale Earnhardt(R), Dale Earnhardt, Jr.(R), Mark Martin, Matt Kenseth, Chad Little, Jeff Burton and Bill Elliott.

    On January 31, MDI Entertainment, Inc. announced that it signed an agreement with The Lottery Channel, which will merge into a wholly owned subsidiary of MDI. Subject to stockholder approval, the merged Company will be renamed Lottery.com, Inc. The primary business objective of the merged Company, in addition to licensing entertainment properties, cultural icons and personalities, will be to position itself as the leading provider of lottery information, entertainment and commerce on the Internet. Completion of the merger is subject to a number of conditions, including receipt of a fairness opinion for MDI stockholders, approval of the stockholders of The Lottery Channel, receipt of certain financing and other matters.

    The Private Securities Litigation Reform Act of 1995 provides a "safe harbor for forward-looking statements. Certain information included in this press release (as well as information included in oral statements or other written statements made or to be made by MDI) contains statements that are forward-looking, such as statements relating to the future anticipated direction of the lottery industry, plans for future expansion, various business development activities, planned capital expenditures, future funding sources, anticipated sales and potential contracts. Such forward-looking information involves important risks and uncertainties that could significantly affect anticipated results in the future and, accordingly, such results may differ from those expressed in any forward-looking statements made by or on behalf of MDI. These risks and uncertainties include, but are not limited to, those relating to development and expansion activities, dependence on existing management, financing activities, domestic and global economic conditions, changes in federal or state tax laws and market competition factors.