(1) Except as provided in (8), an ownership interest may not be transferred among existing owners without submitting an amended gambling license application to the department and obtaining department approval prior to the transfer.

(2) Gambling activity may continue pending the outcome of a license investigation for a proposed transfer of ownership due to the death of a licensee under joint tenancy with right of survivorship as long as the person to whom the interest is transferred is already listed as an owner in the licensed operation and joint tenancy had been documented and approved in the original license application. The transfers must be reported on Form 37 along with the following documents:

(a) death certificate;

(b) will of the deceased, if any; and

(c) copy of the licensee's most recent financial statements or tax return.

(3) Gambling activity may continue pending the outcome of a license investigation for the proposed transfer of ownership in a licensed operation resulting from divorce as long as the spouse to whom an interest is transferred has already been approved and listed as an owner of that license. These types of proposed transfers must be reported on Form 37 along with the following documents:

(a) court decree of dissolution of marriage;

(b) source of funding documents, if any, if the transfer requires a buyout, e.g., bank statements supporting cash payments, loan and security agreements, installment payment agreement, etc.;

(c) copy of the licensee's most recent financial statements or tax return;

(d) if the transferring spouse will no longer be a licensee, copies of letters or other documents from lenders, landlords, or other parties to whom the licensee is obligated, which release the spouse from primary responsibility for the obligation, although the transferring spouse may still guarantee the obligation; and

(e) if the transferring spouse is no longer a licensee, an updated bank signature card.

(4) Gambling activity may continue pending the outcome of a license investigation for a proposed transfer of ownership in a licensed operation by gift among licensees. This type of proposed transfer must be reported on Form 37 along with the following documents:

(a) gifting statement which provides the names of the parties, the intent of the parties, and the percentage ownership to be transferred through the gift; and

(b) copy of the licensee's most recent financial statements or tax return.

(5) The department may conduct an investigation to determine whether the proposed transfer meets the licensure requirements in 23-5-176, MCA, and department rules. In any case of the transfer of an ownership interest among existing owners, before approving the transfer, the department must determine that the transferred ownership interest is independently exercised by the new owner and does not remain under the control of the transferor.

(6) Within 60 days after receiving the completed amended application, the department shall approve the proposed transfer by issuing an amended gambling license or notify the parties involved of the denial of the license or other appropriate action.

(7) The department may not charge any additional annual gambling license or machine permit fees.

(8) The provisions of this rule do not apply to the:

(a) transfer of a security interest in a licensed gambling operation; or

(b) transfer of less than 5% interest in a publicly-traded corporation. Transfers of an interest of 5% or more in a publicly-traded corporation are subject to the provisions of this rule, except that the transfer may occur without prior department approval. The department reserves the right to act under 23-5-136, MCA, in this situation if it determines that the transfer violates Montana gambling law or the rules in this chapter.