California § 19892 - The purported sale, assignment, transfer, pledge, or other disposition of any int

§ 19892. The purported sale, assignment, transfer, pledge, or other disposition of any int

(a) The purported sale, assignment, transfer, pledge, or other disposition of any interest in a partnership or limited liability company that holds a gambling license, or the grant of an option to purchase the interest, is void unless approved in advance by the commission. (b) (1) If at any time the commission denies a license to, or revokes the license of, an individual owner of any interest described in subdivision (a), the commission shall immediately notify the individual and the partnership or limited liability company of that fact. (2) The individual denied a license, or whose license is revoked, shall sell their interest in an amount not greater than fair market value, within 60 calendar days of the denial or revocation. Upon a showing of due diligence, the commission may extend the time for selling the security. (c) Beginning upon the date when the commission serves a notice of denial upon the partnership or limited liability company, it is unlawful for the denied owner of the interest to do any of the following: (1) Receive any share of the revenue or interest upon the partnership or limited liability company interest, except distributions equal to the good faith estimate of the owner’s personal share of any income tax due on the ownership interest until the date of the sale as determined in writing by an independent certified public accountant. (2) Exercise, directly or through any trustee or nominee, any voting right conferred by that interest. (3) Receive any remuneration in any form from the partnership, for services rendered or for any other purpose. (d) Every certificate of limited partnership of any limited partnership or limited liability company holding a gambling license shall contain a statement of the restrictions imposed by this section. (e) (1) The commission may, at its discretion, not apply the provisions of subdivision (c) or paragraph (2) of subdivision (b) when the person who has been denied a license was denied that license solely due to the person’s failure to clearly establish eligibility and qualification for licensure as described in subdivision (a) of Section 19859. (2) Paragraph (1) shall not apply if additional grounds for denial of the license existed, whether or not those grounds were formally provided as the reason for the denial.