(1) In staging the annual Upper Peninsula state fair, the board of managers may enter into licensing agreements with concessionaires permitting games of skill which shall be conducted in accordance with the following criteria:

    (a) Winning the game of skill does not require great skill on the part of the participant.

    (b) The game does not constitute a fraud upon the participants.

    (c) The game is not similar to games of chance in which winning depends primarily upon fortuitous or accidental circumstances beyond the control of the participant including but not limited to games such as roulette, beano, cards, dice or wheels of fortune nor is the game one which includes any mechanical or physical devices which directly or indirectly impedes, impairs or thwarts the skill of the player.

    (d) If the game is a group or contest participation game, each participant shall be in attendance at the time the game is played and shall actively participate throughout the entire game by personally designating his or her target, goal, or desired objective. A winner shall be determined by the skill of 1 or more of the participants in the group or contest game, and each participant shall be randomly selected, and a distribution of prizes shall be made in the presence of each participant at the time the game is played.

    (e) The prize shall have a nominal value and shall not be redeemable or convertible into cash, directly or indirectly.

    (2) The board of managers may promulgate rules pursuant to Act No. 306 of the Public Acts of 1969, as amended, being sections 24.201 to 24.315 of the Michigan Compiled Laws, and consistent with the criteria established in subsection (1) to regulate the conducting of games of skill during the annual Upper Peninsula state fair and to protect the public from unauthorized or dishonest practices in conducting those games.

    (3) The board of managers may, without holding a hearing, revoke the licensing agreement of a concessionaire when the board of managers or the Upper Peninsula state fair secretary-manager finds that the public is being defrauded or that a criteria established in subsection (1) or by rule is being ignored or violated. Members of the board of managers and the Upper Peninsula state fair secretary-manager shall be personally liable for an action they take in their official capacity in regard to licensing agreements entered into pursuant to this section. If there is a judgment against them, the state shall pay a judgment against a member or the secretary-manager, who shall not be required to reimburse the state.