5-108.03. Restrictions on ownership of licenses, permits and tracks; exemptions; sale for fair market value

A. From and after December 31, 1978, no person, firm, partnership, corporation or association or any affiliate thereof shall simultaneously hold or have an ownership interest, direct or indirect, in permits to conduct racing meetings at more than four racetracks within this state. For the purpose of this chapter a person, firm, partnership, corporation or association holding or having an ownership interest, direct or indirect, in a place, enclosure or track at which a racing meeting is conducted in this state shall be considered as holding an ownership interest in the permit or permits issued for a racing meeting at such location. This subsection shall not apply with respect to a corporation unless the person, firm, partnership, corporation or association otherwise subject to the provisions of this subsection owns or controls ten per cent or more of any class of stock of such corporation.

B. From and after December 31, 1978, no person, firm, partnership, corporation or association or any affiliate thereof, which holds or has an ownership interest, direct or indirect, in a permit to conduct a racing meeting within a county having a population of three hundred thousand persons, or more, as shown by the last United States decennial census, shall simultaneously hold or have any ownership interest, direct or indirect, in a permit to conduct the same kind of racing within any other county having a population of three hundred thousand persons, or more, as shown by the last United States decennial census.

C. Any person, firm, partnership, corporation or association which on the effective date of this section holds or has an ownership interest in permits in excess of the limits specified in subsections A and B shall use diligent effort to dispose of such excess holdings and interests prior to January 1, 1979. If such person, firm, partnership, corporation or association has failed to receive a reasonable offer, containing adequate security provisions, for the acquisition of such excess holdings or interest at the fair market value thereof prior to January 1, 1979, the department shall grant an extension of the affected permits for a one-year period. At the expiration of such extension, the department shall grant additional one-year extensions but in no event shall the department grant more than three extensions for an affected permittee. Upon the disposal of such excess holdings and interest or expiration of the maximum number of extensions authorized, the limitations set forth in subsections A and B shall apply.

D. For the purposes of subsections A, B and C, a person, firm, partnership, corporation or association shall be considered as itself holding or having any ownership interest held directly or indirectly by its affiliates. For the purposes of this chapter, one person, firm, partnership, corporation or association shall be considered the affiliate of another person, firm, partnership, corporation or association if any of the following applies:

1. They are either directly or indirectly under common control.

2. Any officer, director, manager, partner, supervisor, substantial stockholder, owner, trustee or administrator of one such person, firm, partnership, corporation or association is an officer, director, manager, partner, substantial stockholder, owner, trustee or administrator of the other person, firm, partnership, corporation or association. For the purposes of this paragraph, a substantial stockholder is one who owns at least ten per cent of the issued and outstanding stock of a corporation.

3. They, at any time, within an immediately preceding three-year period, have each had a substantial ownership interest in the same permittee authorized to conduct a racing meeting in this state. For the purposes of this paragraph, the direct or indirect ownership of ten per cent or more of the equity of a permittee shall be considered a substantial ownership interest.

4. Notwithstanding the provisions of paragraph 3 of this subsection, any persons, firms, corporations, partnerships or affiliates thereof having a substantial ownership interest in the same permittee authorized to conduct a racing meeting in this state during 1976 shall be considered to be affiliates for purposes of subsections A and B until January 2, 1979, or until the termination of any extension granted by the department pursuant to subsection C, whichever period is longer. For the purposes of this paragraph, the direct or indirect owner of ten per cent or more of the equity of a permittee shall be considered a substantial ownership interest.

E. For purposes of determining interest in a permit or permittee, insofar as such determination is based on stock ownership:

1. Stock owned, directly or indirectly, by or for a corporation, partnership, estate or trust shall be considered as being owned proportionately by its shareholders, partners or beneficiaries.

2. An individual shall be considered as owning the stock owned, directly or indirectly, by or for his family or by or for his partner. For purposes of this section, the family of an individual includes only his brothers and sisters, whether by the whole or half blood, spouse, ancestors and lineal descendants.

3. Stock constructively owned by a person by reason of the application of paragraph 1 of this subsection shall, for purposes of applying paragraph 1 or 2 of this subsection, be treated as actually owned by such person. Stock constructively owned by such person by reason of the application of paragraph 2 of this subsection shall not be treated as owned by him for purposes of again applying paragraph 2 of this subsection in order to make another the constructive owner of such stock.

5-108.03. Restrictions on ownership of licenses, permits and tracks; exemptions; sale for fair market value

A. From and after December 31, 1978, no person, firm, partnership, corporation or association or any affiliate thereof shall simultaneously hold or have an ownership interest, direct or indirect, in permits to conduct racing meetings at more than four racetracks within this state. For the purpose of this chapter a person, firm, partnership, corporation or association holding or having an ownership interest, direct or indirect, in a place, enclosure or track at which a racing meeting is conducted in this state shall be considered as holding an ownership interest in the permit or permits issued for a racing meeting at such location. This subsection shall not apply with respect to a corporation unless the person, firm, partnership, corporation or association otherwise subject to the provisions of this subsection owns or controls ten per cent or more of any class of stock of such corporation.

B. From and after December 31, 1978, no person, firm, partnership, corporation or association or any affiliate thereof, which holds or has an ownership interest, direct or indirect, in a permit to conduct a racing meeting within a county having a population of three hundred thousand persons, or more, as shown by the last United States decennial census, shall simultaneously hold or have any ownership interest, direct or indirect, in a permit to conduct the same kind of racing within any other county having a population of three hundred thousand persons, or more, as shown by the last United States decennial census.

C. Any person, firm, partnership, corporation or association which on the effective date of this section holds or has an ownership interest in permits in excess of the limits specified in subsections A and B shall use diligent effort to dispose of such excess holdings and interests prior to January 1, 1979. If such person, firm, partnership, corporation or association has failed to receive a reasonable offer, containing adequate security provisions, for the acquisition of such excess holdings or interest at the fair market value thereof prior to January 1, 1979, the department shall grant an extension of the affected permits for a one-year period. At the expiration of such extension, the department shall grant additional one-year extensions but in no event shall the department grant more than three extensions for an affected permittee. Upon the disposal of such excess holdings and interest or expiration of the maximum number of extensions authorized, the limitations set forth in subsections A and B shall apply.

D. For the purposes of subsections A, B and C, a person, firm, partnership, corporation or association shall be considered as itself holding or having any ownership interest held directly or indirectly by its affiliates. For the purposes of this chapter, one person, firm, partnership, corporation or association shall be considered the affiliate of another person, firm, partnership, corporation or association if any of the following applies:

1. They are either directly or indirectly under common control.

2. Any officer, director, manager, partner, supervisor, substantial stockholder, owner, trustee or administrator of one such person, firm, partnership, corporation or association is an officer, director, manager, partner, substantial stockholder, owner, trustee or administrator of the other person, firm, partnership, corporation or association. For the purposes of this paragraph, a substantial stockholder is one who owns at least ten per cent of the issued and outstanding stock of a corporation.

3. They, at any time, within an immediately preceding three-year period, have each had a substantial ownership interest in the same permittee authorized to conduct a racing meeting in this state. For the purposes of this paragraph, the direct or indirect ownership of ten per cent or more of the equity of a permittee shall be considered a substantial ownership interest.

4. Notwithstanding the provisions of paragraph 3 of this subsection, any persons, firms, corporations, partnerships or affiliates thereof having a substantial ownership interest in the same permittee authorized to conduct a racing meeting in this state during 1976 shall be considered to be affiliates for purposes of subsections A and B until January 2, 1979, or until the termination of any extension granted by the department pursuant to subsection C, whichever period is longer. For the purposes of this paragraph, the direct or indirect owner of ten per cent or more of the equity of a permittee shall be considered a substantial ownership interest.

E. For purposes of determining interest in a permit or permittee, insofar as such determination is based on stock ownership:

1. Stock owned, directly or indirectly, by or for a corporation, partnership, estate or trust shall be considered as being owned proportionately by its shareholders, partners or beneficiaries.

2. An individual shall be considered as owning the stock owned, directly or indirectly, by or for his family or by or for his partner. For purposes of this section, the family of an individual includes only his brothers and sisters, whether by the whole or half blood, spouse, ancestors and lineal descendants.

3. Stock constructively owned by a person by reason of the application of paragraph 1 of this subsection shall, for purposes of applying paragraph 1 or 2 of this subsection, be treated as actually owned by such person. Stock constructively owned by such person by reason of the application of paragraph 2 of this subsection shall not be treated as owned by him for purposes of again applying paragraph 2 of this subsection in order to make another the constructive owner of such stock.