Star Tech Journal

Issue: 1984-August - Vol 6 Issue 6

__ s _____ CTAR*-rECH JOURNll'~11.., _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ A_uG_u_s_r_1_98_4 _ _
CALL
VIDEO GAMES CAN CAUSE
INTERFERENCE TO RADIO
COMMUNICATIONS
916-361-0565
I
WATER SOLUBLE
RESIN
This NEW solder has a
flux that you can clean off
with a brush and a few
drops of water.
22-gauge, 1 pound roll -
$18.95
Laserdisc repair
service on
Pioneer,
Sylvania,
Magnavox,
Phillips
and MCA
25¢ conversion module
for 50¢ games
• One module per game
• Adjustable coin each
• Easy installation
• Module mounts behind
coin door
$24.95 each
TEM: State Police of a western state
complained to the Federal
Communication Commission that coin·
operated electronic games were causing
harmful interference to highway police
communications.
Operators should be aware that ALL amuse-
ment games, jukeboxes and vending
equipment having electrical parts may cause
interterence to police and other emergency
communications.
PROBLEMS AND ISSUES
The Federal Communication Commission
has received a number of complaints that
electric pulses from video games which have
not been properly shielded have caused inter-
ference with police and emergency
communications. The Atlanta office of the
FCC has been working on this problem and
will be the test area for the rest of the country.
The FCC Regional Office in Atlanta held a
meeting on June 6 with representatives from
AMOA, AVMDA and AGMA to discuss this
problem. Since December 1982, video games
are now covered under Class A computing
devices of the FCC rules. A computing device
is defined as follows:
Any electronic device or system that
generates and uses timing signals or pulses
at a rate in excess of 10,000 pulses per
second and uses digital techniques;
inclusive of telephone equipment that
utilizes digital techniques or any device or
system that generates and utilizes radio
frequency energy for the purpose of
performing data processing functions, such
as electronic computations, operations,
transformations, recording, filing, sorting,
storage, retrieval, or transfer.
OPERATOR ALERT
Logic board repair
service - pinball boards
and videos only; color
and black and white
monitor repair service.
LINEAR
ELECTRONICS
9795-H Business Park Dr.
Sacramento, CA 95827
The FCC is still in the process of revising Rule
15 which covers this area. Nevertheless, with
the rapid increase of conversion kits, there
are a number of precautions that must be
taken by operators so that you are not in
violation of the law. Operators are urged to
read carefully the following and take whatever
steps are necessary in your present business
practices:
1. Amusement games manufactured prior to
December 1982 are "Grandfathered" in
this rule.
2. The following warning label must appear on
the outside of the cabinet in plain sight and
must be permanently attached:
This equipment complies with the
requirements in Part 15 of FCC Rules for
a Class A computing device. Operation of
this equipment in a residential area may
cause unacceptable interference to radio
and TV reception requiring the operator
to take whatever steps are necessary to
correct the interference.
3. It is a violation for a manufacturer to sell a
conversion kit without the above label.
4. ALL conversion kits must be installed in
previously approved cabinets (containing
the warning label). Any kit put into a cabinet
which previously did not comply must now
comply with this regulation. (Note: equip-
ment may be seized if in non-compliance.)
5. Conversion kits must be installed properly
and according to the specific directions
contained in the installation manual. Any
kits improperly installed will be a violation
against the person responsible for instal-
lation.
6. Conversion kits should state the power
supply to be used. Making any modifications
in order to increase the power would be a
violation on the part of the operator.
7. All protective shields either on existing
games or those provided with conversion
kits must be properly installed and/or
replaced after repair service.
8. If you have any questions on compliance,
you can contact your district office of the
FCC or write to the AMOA AMOA will then
forward all questions to the Atlanta office
for a response. The title of the person to
contact at your district office is the Public
Services Director.
AMOA will continue to keep you advised on
developments as they occur in this area.
MURPHY'S • _AW
#606
In a hierarchical organization, the higher the level, the greater the confusion.
__
A_uG_u_s_T_19_a_4 _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ $TAR'11
IEC,I JOURNAL.____,I,
PUTTINB A VALUE ON YOUR
COIN-OPERATED BAMES BUSINESS
BY MARK E. BATTERSBY
W
hether the coin-operated amuse-
ments operation isa mom-and-pop
business or a multinational corporation, the
need to set a value on the business frequently
arises. And, as many operators can well attest,
setting a value on any going business is never
an easy task.
The first step in setting a value on any coin-
operated amusements operation is to identify
the specific purpose of the valuation. For
example:
Do you want a high valuation because you
are planning to sell the business or trying to
raise capital for expansion?
Do you want a low valuation because you
are planning to gift the stock in your business
to your children or valuing it for estate tax
purposes?
Here are a few of the methods used for
valuing amusement businesses:
With a smaller business having two or
more owners, those owners frequently set an
initial value themselves, i.e., what they think
the stock in their coin-operated amusements
operation is worth. This is a common method
used in buy-sell agreements (stock repur-
chases) between stockholders. The value can
be the reported book value per share, a
certain multiple of earnings or any of the six
other values we'll cover.
For example, suppose that your amuse-
ments operation is owned equally by you and
another individual. You each have 50,000
shares of common stock (a total of 100,000
shares outstanding). The company's net
income is $100,000 and its balance sheet
looks like this:
Assets
$1 ,000,000
Liabilities
Net book value
$ 600,000
400,000
$1 ,000,000
Book value per share
= $4.00
Earnings per share
=$1.00
If we assume a price-earnings multiple of
ten, the value of each share of stock is $10.
The two principals in this coin-operated
amusements operations can arbitrarily decide
to place a 50 percent weight on their book
value per share and 50 percent on their
multiple of earnings value. Based on these
two assumptions, the weighted value per
share would be computed as follows:
METHOD
VALUE
Book value $ 4.00
Multiple of
earnings
$10.00
WEIGHT
WEIGHTED
VALUE
50%
$2.00
50%
100%
$5.00
$7.00
Buy-Sell Value: Both principals in the
operation can decide that $7 per share is the
per-share value for the purchase of the other's
stock on death - purchased by either of you
(cross-purchase agreement) or by your
company (stock-redemption agreement).
A word of warning that buy-sell agreements
should be revised annually to allow for
changes in the value per share. To accomplish
Philosophy
Bally Midway believes in a responsibility to you. From idea to
finished product we keep your service needs in mind.
We are very proud of the high ratings you have given us in the
Star Tech Journal's Reader's Survey. It is our intention to con-
tinue to earn your support. Contact your Bally Midway Distributor
for service school information. And don't forget our newsletter.
To receive it, call our toll free numbers:
(800) 323-3555 (Pinball)
(800) 323-7182 (Video)
M1ur Partner in Service.

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