N.Y. Racing, Pari-Mutuel Wagering and Breeding Law § 303: Filing of information concerning stock transfers; necessity for commission approval

§ 303. Filing of information concerning stock transfers; necessity for

commission approval. 1. Whenever a transfer of stock of any association

or corporation that is licensed under this article, or of any

association or corporation that leases to such licensee the track at

which it conducts pari-mutuel harness races, or that owns twenty-five

percent or more of the stock of such licensee shall be made, there shall

be filed simultaneously with the association or corporation that issued

such stock the following:

a. In duplicate, an affidavit executed by the transferee stating that

the affiant is to be the sole beneficial owner thereof, and whether or

not the affiant has (i) been convicted of a crime involving moral

turpitude, (ii) been engaged in bookmaking or other forms of illegal

gambling, (iii) been found guilty of any fraud or misrepresentation in

connection with racing or breeding, (iv) been guilty of any violation or

attempt to violate any law, rule or regulation of any racing

jurisdiction for which suspension from racing might be imposed in such

jurisdiction, or (v) violated any rule, regulation or order of the

commission; if the transferee is not, or is not to be, the sole

beneficial owner thereof, then there shall be annexed to said affidavit

of the transferee, and expressly stated in such affidavit to be deemed a

part thereof, a true and complete copy, or if oral, a complete statement

of all the terms, of the agreement or understanding pursuant to which

the stock is to be so held by the transferee, including a detailed

statement of the interest therein of each person who is to have any

interest therein; and at the same time.

b. In duplicate, an affidavit executed by each person for whom such

stock, or any interest therein, is to be held by said transferee,

setting forth whether or not the affiant has (i) been convicted of a

crime involving moral turpitude, (ii) engaged in bookmaking or other

forms of illegal gambling, (iii) been found guilty of any fraud or

misrepresentation in connection with racing or breeding, (iv) been

guilty of any violation or attempt to violate any law, rule or

regulation of any racing jurisdiction for which suspension from racing

might be imposed in such jurisdiction, or (v) violated any rule,

regulation or order of the commission; to each of which affidavits shall

be annexed, and expressly stated in such affidavit to be deemed a part

thereof, a true and complete copy, or if oral, a complete statement of

all the terms, of the agreement or understanding pursuant to which the

stock is to be so held by the transferee, including a detailed statement

of the interest therein of each person who is to have any interest

therein.

c. Said association or corporation shall forthwith file with the

commission one of each of said duplicate affidavits.

2. If, after the filing of any affidavit required to be filed by

subdivision one of this section, there is any change in the status of

any such affiant with respect to any of the matters set forth in

subparagraph (i), (ii), (iii), (iv) or (v) of paragraph a of subdivision

one of this section of the affidavit theretofore filed by him or her,

such affiant shall forthwith file with the association or corporation

with which the affiant's affidavit was so filed a new affidavit,

executed in duplicate, setting forth such change of status, and the

association or corporation shall forthwith file one of said affidavits

with the commission.

3. Whenever any change is made in the amount, nature, or otherwise, of

the interest of any person having an interest in stock of any such

association or corporation, or any new interest is created therein,

without a transfer of such interest as provided in subdivisions one and

two of this section, the record owner of such stock, and each person

whose interest therein has been so attempted to be changed or created,

shall file with the association or corporation that issued such stock,

in duplicate, affidavits as provided by paragraphs a and b of

subdivision one of this section, except that such affidavits need not

include the matters referred to in subparagraphs (i), (ii), (iii), (iv)

and (v) of paragraph a of subdivision one of this section, unless then

required pursuant to subdivision two of this section, and one copy

thereof shall forthwith be filed by the association or corporation with

the commission.

4. The commission may, upon application to it for good cause shown,

waive compliance with subdivisions one, two and three of this section.

5. If the commission determines that it is inconsistent with the

public interest, convenience or necessity, or with the best interests of

racing generally, that any person continue to be a stockholder of

record, or the beneficial owner of any interest in stock standing in the

name of another, in any association or corporation licensed under this

article, or of any association or corporation that leases to such

licensee the track at which it conducts pari-mutuel harness racing or

that owns twenty-five percent or more of the stock of such licensee, the

commission shall have full power and authority to order or direct each

such stockholder or beneficial owner irrespective of the time when such

stockholder or beneficial owner acquired his or her stock or interest

therein to dispose of such stock or interest within a period of time to

be specified by the commission, which period the commission shall have

full power and authority to extend from time to time.

6. If the commission shall make any order or direction as provided in

subdivision five of this section, the person aggrieved thereby shall be

given notice of the time and place of a hearing before the commission at

which the commission will hear such person in reference thereto. The

action of the commission in making any such order or direction shall be

reviewable in the courts of this state in the manner provided by, and

subject to the provisions of article seventy-eight of the civil practice

law and rules.

7. Upon application of the commission, the supreme court of this state

shall have jurisdiction to issue final orders, on notice and after

hearing, commanding any person to comply with the provisions of the

orders or directions issued by the commission under subdivision five of

this section.

8. In case of conflict between this section and article eight of the

uniform commercial code, this section shall control.

§ 43. Subdivision (b) and the closing paragraph of section 303-a of

the racing, pari-mutuel wagering and breeding law, as added by chapter

281 of the laws of 1994, are amended to read as follows:

(b) Non-managing owners. There shall be no restriction on the number

of non-managing owners of a race horse except that no horse shall be

entered or started that is owned by thirty-five or fewer owners unless

all such owners are licensed; in the event that a horse is owned by more

than thirty-five owners, only those individuals having a three percent

or greater property interest in such horse shall be required to be

licensed as an owner.

The commission shall adopt rules and regulations regarding ownership

of horses not inconsistent with this section.