Site Content

This Limited Liability Company (LLC) was started to provide my clients with an opportunity to experience the emotions of owning and racing a thoroughbred horse and to expand my interest and the interest of my clients in the thoroughbred horse racing industry.  One of my objectives is help my clients learn more about the industry, especially from an owner's perspective.  I also want to provide my clients with an opportunity to gain experiences they can't have without owning all or part of a thoroughbred race horse.  I strive to provide my clients with these experiences at a very affordable price.  Lastly, i want to share the racing experience with my clients.  We have so much fun and exciting and I have met such wonderful people (and horses) in the process!

Very simply put, the groups I form acquire ownership of thoroughbred race horses.  I manage all the financial aspects of racing our horses, but I do so in constant communication with my clients.  In coordination with our trainer(s), I manage the affairs of training and racing our horses.  Since I own a percentage of each horse we acquire, I have every incentive to make the venture as profitable as possible.  I am partners with my clients in the ownership groups and provide my clients with as much information, education, and entertainment as I can!

I have managed several ownership groups (The Box Seat Bunch, LLC, Triple Play LLC, Chieftain Stables I, II, and III, LLCs.  Currently, I am the managing member of Chieftain Stables III, LLC. 

Frequently Asked Questions (FAQs)

Q.  What is Chieftain Stables III, LLC

A.  Chieftain Stables III, LLC (CS III) is a limited liability company formed for the purpose of managing thoroughbred race horse ownership groups which will then acquire thoroughbred horses to race.  CS III is managed by Tom Gardiner (see Bio information).

Q.  What is an LLC?

A.  LLC is the acronym for Limited Liability Company.  An LLC is made up of members and each member of an LLC is exempt from the liabilities of the LLC.  Members of an LLC contribute money and their share of the LLC is determined by the amount they have contributed in relationship to the total amount contributed by all the members of the LLC.  For example, if a member contributes $800 of a total $8,000 contributed, the member would own 10% of the LLC being formed.

Q.  Why is the LLC format instead of a General or Limited Partnership?

A.  An LLC limits the liability of all members in case of a lawsuit solely to the assets of the LLC.  In this manner, the members of the LLC are not personally liable or at risk.

Q.  How does owning a percentage of a horse in an LLC work?

A.  For example, if our group (LLC) acquired a horse, then each member  owned a percentage of the horse equal to the percentage they owned of the LLC.  If the LLC had eight members, each of whom contributed $500 to the $4,000 contributed, each member would own 12.5% of the LLC and, therefore, 12.5% of the horse.

Q.  Can a member expect to earn a profit on their investment?

A.  While I have every intention of making money in our endeavors, horse racing is a risky business.  Things are structured so you can participate without facing substantial financial loss.  And please note that financial gain is not the primary objective for forming these racing groups.  I do it so my clients and I can experience the excitement and emotions of owning and racing thoroughbred horses.

Q.  What percentage of a group (LLC) is for sale?

A.  Sales are on a first come, first serve basis.  I will sell as large a percentage in a new group being formed that is available at the time.  I also work with my clients to help them acquire the right percentage of ownership for them.  Many of my clients have owned as little as 1% of the group they were in.

Q.  How much do I have to spend to become a member of one of the ownership groups?

A.  That depends on the package being offered.  Details are presented in the announcement of the formation of each new group.  (See NEW OFFERINGS)

Q.  Can a member get out of the LLC before it is concluded?

A.  A member can only exit the LLC if he or she finds a buyer for his or her share of the LLC OR when the members of the LLC as a whole agree to disperse.  Current members have right of first refusal if a member decides they want to exit the LLC.  A chance to disperse would also occur when the horses in the LLC have been sold, claimed, or otherwise retired.  Prospective members should be prepared to be in the LLC for the life of the venture, usually one to three years.

Q.   Where will the horses race?

A.  We race mainly in Kentucky (Churchill Downs, Keeneland, Ellis Park, and Kentucky Downs) from April to November, and at Oaklawn Park in Hot Springs, AR from January through April.  We race in other places as circumstances warrant.

Q.  How soon after a horse is acquired will it race?

A.  Normally we acquire our horses via the claiming process.  When that happens, we like to race three or four weeks after acquisition, but the can be longer, depending on the condition of the horse we acquire and the races available.

Q.  Where do the majority of the members of the LLC reside?

A.  Originally most of our members of our LLCs lived in or near Virginia and Maryland.  With the move of the LLC's manager to Kansas in 2009, new members were added from Kansas, Missouri, and Illinios.  With yet another move by the manager to California in 2015, members living on the west coast became involved.  Currently, we have members from California, Washington, Kansas, Missouri, Illinois., New Jersey, Virginia, Florida, Pennsylvania, Mississippi, and Kentucky.

Q. How much does it cost to have a horse in training?

A.  The amount can vary greatly from trainer to trainer, but we generally budget $3,500 to $5,000 a month for training and vet bills. Costs can run higher if the horse gets sick or needs special attention.

Q.  How are expenses for training handled?

A.  Generally you will be billed for any uncovered expenses for a given month.  If we are fortunate enough to earn enough money as we go along, you won't be billed for anything!  For example, if expenses for a month were $5,000 and we didn't earn any money that month, you would be billed for your percentage of the expenses.  If you own 4% of the LLC, you would be billed for 4% of the uncovered expenses.

Q,.  How is the manager of the LLC compensated?

A.  The manager does not receive any compensation except for a $500 a trip travel allowance when he travels to races and to attend to other horse business.

Q.  How are member voting rights determined?

A.  A member gets one vote for each percentage of the LLC owned.  If  a member owns 5% of the LLC, he or she gets 5 votes of the 100 votes available.

Q.  Do members have any input into the campaigning of the horse?

A.  Not really.  The trainer, in conjunction with the LLC manager, makes all the decisions regarding the training and racing of the horses.  The LLC manager, who usually owns a substantial interest in the LLC, will be in close contact with the trainer at all times and will look after the best interest of the members.  That said, the LLC manager communicates quite regularly with the members of the LLC that want to have their opinions heard.  That is a large part of the education process and it is fun!

Q.  Do members have a say in anything?

A.  Yes!  Members will discuss and vote on the business aspects of the LLC such as the expenditure of capital and determining when the LLC should ended.

Q.  How are members kept informed?

A.  CS III maintains a website, www.ChieftainStables.com on which current information is posted.  Also, emails are sent from the LLC manager to all members on a regular basis and when feedback from members is needed.  Regular post mail will be used for important documents such as income tax documents.  Lastly, meetings will be held via conference call or virtually to discuss any needed business.

Q.  How will I know how much I owe, if anything?

A.  Each month you will receive financial reports, including an Income Statement, a Balance Sheet, and a report showing the activity in your account.

Q.  What about tax reporting?

A.  Each year each member will receive a Form K-1 which will report the amount of income or loss.  The form should be filed with the member's state and federal income tax return.

Q.  Will I need an owner's license at each track where we races?

A.  You are not required to obtain a license, but you can if you want.  The LLC manager will work with you to acquire such licenses.  The costs of licenses varies greatly from state to state.

Q.  What "perks" can I expect?

A.  With an owner's license, most tracks provide you with free parking, racing programs and other preferential treatment.  Without an owner's license, no perks can be expected because the track personnel cannot distinguish you from other track patrons.

Q.  Do I need to sign a contract?

A.  You don't have to and most clients don't, but it is in your best interest to do so.  CS III has a contract for each new member of an LLC which can be signed by both the member and the LLC manager.  The contract is designed for the protection of all involved.  A sample contract is available upon request.