A BILL TO BE ENTITLED
AN ACT to require out-of-state applicants as athlete agents to file a north carolina application; to change bonding requirements for athlete agents; to strengthen existing athlete signature requirements by requiring notarized signatures on student-athlete contracts; to clarify record-keeping requirements; to expand requirements for records access for the SECRETARY of state; to require athlete agents to provide signed contracts for student-athletes to the SECRETARY of state within a certain time period; to require athlete agents to provide the SECRETARY of state with notarized contracts regarding student‑athletes by a person other than an educational institution employee, family member, or individual acting solely on behalf of a professional sports team or organization where the contracting person may have an expectation of benefit; to clarify the prohibition on athlete agents  providing things of value to student-athletes before the student-athletes have signed contracts with the athlete agents.
The General Assembly of North Carolina enacts:
SECTION 1.  Article 9 of Chapter 78C of the General Statutes reads as rewritten:
"Article 9.
"Uniform Athlete Agents Act.
"§ 78C‑85.  Title.
This Article may be cited as the "Uniform Athlete Agents Act".
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"§ 78C‑89.  Registration as athlete agent; form; requirements.
(a)	An individual seeking registration as an athlete agent shall submit an application for registration to the Secretary of State in a form prescribed by the Secretary of State. The application must be in the name of an individual  and signed or otherwise authenticated by the applicant under penalty of perjury and must state or contain the following:
. . .
(b)				
An applicant for registration as an athlete agent in North Carolina pursuant to G.S. 78C‑88 shall submit with the application a satisfactory cash bond or proof of establishment of a trust account in that amount with a licensed and insured bank or savings institution located in the State of North Carolina. The bond or trust account shall be in favor of the State of North Carolina. If a trust account is established, the applicant shall include with the application two copies of the formal notification by the depository that the trust account is established. Any bond shall be delivered by the Secretary of State to the Treasurer of the State of North Carolina to be maintained in an interest-bearing special fund. The amount of the cash bond or trust account shall be:
(1)	Fifty thousand dollars ($50,000) to be submitted with the applicant's initial application for registration as an athlete agent in North Carolina;
(2)	An additional twenty‑five thousand dollars ($25,000) to be submitted with the applicant's first renewal application for registration as an athlete agent in North Carolina; and
(3)	An additional twenty‑five thousand dollars ($25,000) to be submitted with the applicant's second renewal application for registration as an athlete agent in North Carolina.
At no time shall the total cash bond or trust account principal exceed one hundred thousand dollars ($100,000) for an individual athlete agent.
(b1)	The cash bond shall be returnable to the athlete agent six months after the athlete agent ceases to be a registered North Carolina athlete agent or the Secretary of State has denied the application for registration or renewal, unless the Secretary of State has been notified of pending legal action against the agent by an educational institution pursuant to G.S. 78C‑100. The bond or trust account shall be available to satisfy any award or judgment to the educational institution arising from the athlete agent's violation of this Article. The Treasurer of the State of North Carolina or the bank or savings institution holding the trust account shall release the principal and interest accrued on the cash bond or trust account only upon receipt of a court order directing release or upon certification by the Secretary of State that no notice of pending legal action has been received pursuant to this section from an educational institution.
(c)	An application filed under this section is a "public record" within the meaning of Chapter 132 of the General Statutes.
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"§ 78C‑94.  Required form of contract.
(a)	An agency contract must be in a record, signed or otherwise authenticated by the parties. The student‑athlete's signature shall be acknowledged before a notary public. 
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"§ 78C‑97.  Required records; waiver of attorney‑client privilege.
(a)	An athlete agent shall retain the following records for a period of five years:
(1)	The name and address of each individual represented by the athlete agent.
(2)	Any agency contract entered into by the athlete agent.
(3)	Any expenses incurred by the athlete agent, or any person acting at the direction of the athlete agent, in the recruitment or solicitation of a student‑athlete to enter into an agency contract.
(4)	A list of all other athlete agents affiliated with the athlete agent, employees of the athlete agent, and all persons acting at the direction of the athlete agent in the recruitment or solicitation of student‑athletes to enter into agency contracts.
(5)	A list of all telephone numbers, including records for each number showing all incoming and outgoing communications, used by the athlete agent, or any person acting at the direction of the athlete agent, in the recruitment or solicitation of a student‑athlete to enter into an agency contract.
(6)	All checkbooks, bank statements, canceled checks, and credit card statements for all accounts used by the athlete agent, or any person acting at the direction of the athlete agent, in the recruitment or solicitation of a student‑athlete to enter into an agency contract.
(7)	Originals or copies of all written communications sent by the athlete agent, or any person acting at the direction of the athlete agent, to a student‑athlete or to any other person to recruit or solicit a student‑athlete to enter into an agency contract.
(8)	A record of all communications between an athlete agent, or any person acting at the direction of the athlete agent, with a student‑athlete or any person for the purpose of recruiting or soliciting a student‑athlete to enter into an agency contract.
(9)	Any other record the Secretary of State by rule prescribes.
For purposes of subdivisions (a)(7) and (8) of this subsection, "communication" includes all oral communication and written communication. Written communications include handwritten correspondence, printed correspondence, mailings, text messages, and electronic communications, such as e-mails and communications through social and professional networking sites.
(b)	Records required to be retained by subsection (a) of this section are open to inspection by the Secretary of State during normal business hours. An athlete agent shall deliver within 10 business days any records required to be retained by subsection (a) of this section if requested by the Secretary of State or the Secretary's designee.
(c)	Where a student‑athlete enters into an agency contract regulated under this Article, the student‑athlete will be deemed to waive the attorney‑client privilege with respect to records required to be retained by subsection (a) of this section, subject to G.S. 78C‑94(f).
(d)	Within five business days after entering into an agency contract with an individual who was a student‑athlete at an educational institution located in this State, the athlete agent shall provide a copy of the executed agency contract to the Secretary of State. This requirement shall only apply to former student‑athletes entering into their first agency contract.
(e)	Within five business days after being contacted by a person, who may have an expectation of direct gain or profit or reimbursement of expenses from the agency contract, regarding a student‑athlete at an educational institution located in this State, the athlete agent shall notify the Secretary of State in writing. The notification shall state the person's name, the person's contact information, the identity of the student‑athlete, the method of communication, and the date of the communication. This requirement shall not apply if the person contacting the athlete agent is the student‑athlete, spouse, parent, sibling, or guardian of the student‑athlete, or employed by the educational institution. Information provided to the Secretary of State pursuant to this subsection is protected by G.S. 132‑1.2(1) from disclosure as a public record.
"§ 78C‑98.  Prohibited conduct of athlete agents.
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(b)	An athlete agent shall not intentionally:
(1)	Initiate contact with a student‑athlete unless the athlete agent is registered under this Article.
(2)	Refuse or fail to retain or permit inspection of the records required to be retained by G.S. 78C‑97.
(3)	Fail to register as required by G.S. 78C‑88.
(4)	Provide materially false or misleading information in an application for registration or renewal of registration.
(5)	Predate or postdate an agency contract.
(6)	Fail to notify a student‑athlete before the student‑athlete signs or otherwise authenticates an agency contract for a particular sport that the signing or authentication shall make the student‑athlete ineligible to participate as a student‑athlete in that sport.
(7)	Furnish anything of value to a student‑athlete before the student‑athlete enters into an agency contract.
"§ 78C‑98.1. Prohibited conduct of non‑athlete agents.
(a)	A person shall not:
(1)	Furnish anything of value to a student‑athlete or a student‑athlete's spouse, parent, child, sibling, or guardian before the student‑athlete enters into an agency contract; and
(2)	Advise, influence, guide, recommend, encourage, oppose, or discourage the student‑athlete's selection of a specific athlete agent with the expectation of profit, compensation, salary, gratuity, or benefit in any form.
(b)	Nothing in this section shall prevent a spouse, parent, sibling, grandparent, or guardian of a student‑athlete or an educational institution which the student‑athlete attends from furnishing anything of value to the student‑athlete.
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"§ 78C‑101.  Administrative penalty.
The Secretary of State may assess a civil penalty against  any person in an amount not less than ten thousand dollars ($10,000) nor more than twenty‑five thousand dollars ($25,000) for each violation of the provisions of this Article. The Secretary of State may also seek injunctive relief or any other relief available by law to enforce the provisions of this Article."
SECTION 2.  This act becomes effective December 1, 2011, and applies to contracts entered into or offenses committed on or after that date.