Section 436.1041. Obtaining a license for use or benefit of another.

(1) A licensee or an applicant for a license shall not obtain or attempt to obtain a license for the use or benefit of another person whose name does not appear on the license. In addition, a licensee shall not allow a person whose name does not appear on the license to use or benefit from the license.

(2)     The provisions of subrule (1) of this rule do not apply to a participating agreement where the commission approves the participating agreement after a showing of good cause by the on-premise licensee or where a person not licensed by the commission receives 10% or less of the gross sales of the licensed business.

(3)     The provisions of subrule (1) of this rule do not apply to persons approved by the commission and named on a participation permit issued to the licensee. Upon written request of the licensee, the commission may issue a participation permit to a licensee who meets all  of  the   following qualifications:

(a)     The non-licensed person who receives use or benefit from the licensee's license or who receives gross or net profits from a licensed business shall meet the same qualifications as a licensee as prescribed by R 436.1101 ET SEQ.

(b)       The licensee makes application and either cancels an existing participation permit or receives a new participation permit before adding or deleting any participating non-licensed person. For the purposes of this subrule, the addition or deletion of a participant  includes  any of  the following:

(i)       Transfer or transfer of interest from 1 person to another.

(ii)    The transfer in the aggregate to another person during any single licensing year of more than10% of  the outstanding stock  of  a corporate participant.

(iii)    The transfer of more than10% of the total interest in a participant which is a partnership.

(iv)   The transfer of more than 10% in the aggregate of the membership of a limited liability company.

History: 1979 AC; 2003 AACS.