Senate BillNo. 777

Introduced by Senator Lara

February 27, 2015

An act to amend Section 19880 of the Business and Professions Code, relating to gambling.


SB 777, as introduced, Lara. Gambling Control Act: corporations.

Existing law, the Gambling Control Act, provides for the licensure and regulation of various legalized gambling activities and establishments by the California Gambling Control Commission and the investigation and enforcement of those activities and establishments by the Department of Justice. Existing law requires a corporation to comply with specified requirements in order to obtain a gambling license, including a requirement that the corporation register as a corporation with the department and supply specified supplemental information to the department.

This bill would make technical, nonsubstantive changes to that provision.

Vote: majority. Appropriation: no. Fiscal committee: no. State-mandated local program: no.

The people of the State of California do enact as follows:

P1    1


Section 19880 of the Business and Professions
is amended to read:



In addition to the requirements of Section 19852, in
4order to be eligible to receive a gambling license as the owner of
5a gambling enterprise, a corporation shall comply with all of the
6following requirements:

P2    1(a) Maintain an office of the corporation in the gambling

3(b) Comply with all of the requirements of the laws of this state
4pertaining to corporations.

5(c) Maintain, in the corporation’s principal office in California
6or in the gambling establishment, a ledger that meets both of the
7following conditions:

8(1) At all times reflects the ownership of record of every class
9of security issued by the corporation.

10(2) Is available for inspection by the department at all reasonable
11times without notice.

12(d) Supply supplemental forms and information, in accordance
13with Section 19865, with the initial license application, and
14thereafter only on request, to the department, which shall include,
15but not be limited to, all of the following:

16(1) The organization, financial structure, and nature of the
17business to be operated, including the names, personal and criminal
18history, and fingerprints of all officers and directors, and the names,
19addresses, and number of shares held by all stockholders of record.

20(2) The rights and privileges acquired by the holders of different
21classes of authorized securities, including debentures.

22(3) The terms on which securities are to be offered.

23(4) The terms and conditions on all outstanding loans,
24mortgages, trust deeds, pledges, or any other indebtedness or
25security interest.

26(5) The extent of the equity security holdings in the corporation
27of all officers, directors, and underwriters, and their remuneration
28as compensation for services, in the form of salary, wages, fees,
29or otherwise.

30(6) The amount of remuneration to persons other than directors
31and officers in excess of one hundred thousand dollars ($100,000)
32per annum.

33(7) Bonus and profit-sharing arrangements.

34(8) Management, consultant, and service contracts related to
35the operation of controlled gaming.

36(9) Options existing, or to be created, in respect of their
37securities or other interests.

38(10) Financial statements for at least three fiscal years preceding
39the year of registration, or, if the corporation has not been in
40existence for a period of three years, financial statements from the
P3    1date of its formation. All financial statements shall be prepared in
2accordance with generally accepted accounting principles and
3audited by a licensee of the California Board of Accountancy.

4(11) Any further financial data that the department, with the
5approval of the commission, may deem necessary or appropriate
6for the protection of the state.

7(12) An annual profit-and-loss statementbegin delete andend deletebegin insert,end insert an annual balance
8sheet, and a copy of its annual federal income tax return, within
930 calendar days after that return is filed with the Internal Revenue