Section 1770.80 Change of Name, Transfer, or Form of Business Organization

Section 1770

Section 1770.80  Change of

Name, Transfer, or Form of Business Organization

a)         Notification of Change

1)         An Agent shall report to the Director, at least 30 days prior

to the effective date of the change, any:

A)        Change of name;

B)        Change of business organization; or

C)        Transfer, except to the extent the change occurs as a result of

the transfer of interest in publicly traded securities, in which case the

reporting must occur within 30 days after the transfer or at the time that any

reporting of the ownership interest must be made to the federal Securities and

Exchange Commission, whichever is earlier.

2)         Reporting may be accomplished by completing a departmental

form provided for that purpose or by mailing notice of the proposed change by

certified mail, return receipt requested, postmarked on or before the 30

th

day prior to the effective date of the change and addressed to the Department as

follows:

Illinois

Lottery

P.O. Box 19081

Springfield,

Illinois  62794-9081

b)         Each notification of change of name, ownership or form of

business organization of a licensee communicated to the Director shall include

the following information:

1)         The name, address and Agent identification number of the Agent;

2)         The name of the business as it appears on the license

application;

3)         The proposed new name of the business, if applicable;

4)         The current form of business organization;

5)         The proposed form of business organization, if applicable;

6)         The current owners, managers or shareholders of the business,

as is indicated on the license application;

7)         The proposed transfer, including the names and addresses of

the proposed new owners, managers or shareholders, the percentage of proposed

transfer of equity, management control, legal ownership, shares or stock; and

8)         The anticipated date of the proposed change in name, business

organization or ownership

reholders of the business,

as is indicated on the license application;

7)         The proposed transfer, including the names and addresses of

the proposed new owners, managers or shareholders, the percentage of proposed

transfer of equity, management control, legal ownership, shares or stock; and

8)         The anticipated date of the proposed change in name, business

organization or ownership.

c)         The Director shall review the changes, considering current

licensing standards, as provided in the Lottery Law and this Part.

d)         The Director, upon approval of a change in name or a change of

business organization that does not also involve a transfer, shall issue a replacement

license reflecting the new name or business structure.  The replacement license

shall have an expiration date no later than the expiration date provided in the

previous license.

e)         Except as provided in this subsection (e), any change of business

ownership shall necessitate termination of the existing licensing agreement, as

of the effective date of the change of ownership.  The new owner must submit an

application and fee as provided in Section 1770.20.  If the existing Agent has

not provided the Department with required written notification of the change,

the applicant may be required to furnish documentation evidencing the change in

ownership, such as a sales contract.  The current license number may be

assigned to the new owner of a location in the following circumstances:

1)         If a chain account location previously operated by a

franchisee continues operation under the franchisor or chain corporate

management, and upon corporate guarantee and assumption of the financial

obligations of the licensee;

2)         If transfer

of the location is assumed by an immediate family member of the original Agent (parent,

sibling, child or grandparent) and the following conditions are met:

A)        The

location is in good standing with the Lottery;

B)        The

family member assuming ownership was invo

agement, and upon corporate guarantee and assumption of the financial

obligations of the licensee;

2)         If transfer

of the location is assumed by an immediate family member of the original Agent (parent,

sibling, child or grandparent) and the following conditions are met:

A)        The

location is in good standing with the Lottery;

B)        The

family member assuming ownership was involved in the day-to-day operation of

the business prior to transfer; and

C)        The

family member assuming transfer is qualified to hold a Lottery license.

f)         Incapacity, Death, Receivership, Bankruptcy or Assignment

1)         In the event of the proven incapacity, death, receivership,

bankruptcy or assignment for the benefit of creditors of any licensed Agent,

and upon approval of the Director, the license may continue under a

court-approved or court-confirmed guardian, executor or administrator, receiver

or trustee for the benefit of creditors, who may continue to operate the

business designated under the license, subject to the provisions of the Lottery

Law and this Part, if the person to whom the license is transferred is

otherwise qualified to hold a license.

2)         The license, following the transfer, shall be void in the

event the license transferee ceases to hold the court-appointed or

court-confirmed position.

3)         The Director may condition the transfer of any license under

this subsection (f)(3) upon the posting of a bond, or a guaranteed payment in

the form of a cashier's check or money order, on such terms and under such

conditions as the Director may deem necessary to protect the financial

interests of the State, provided that any such bond shall reflect the

reasonably anticipated risk of transfer.

g)         Every change in the point of sale designated in the license

shall be reported to the Director no less than 30 days prior to the effective

date of the change

or money order, on such terms and under such

conditions as the Director may deem necessary to protect the financial

interests of the State, provided that any such bond shall reflect the

reasonably anticipated risk of transfer.

g)         Every change in the point of sale designated in the license

shall be reported to the Director no less than 30 days prior to the effective

date of the change.  If the change results from severe damage to or destruction

of the point of sale specified in the license, as a result of fire, natural

disaster or other cause beyond the control of the Agent, the Agent shall

promptly notify the Director of that destruction or damage to the business

premises and the consequent change of location, but in no case shall the

notification be made later than 3 days after the damage to or destruction of

the premises or change of location. Upon notification, the Director shall

consider the factors set forth in Section 1770.20 to determine whether the Agent

should be licensed to sell Lottery game tickets at the new location.  Upon the Director's

approval, a replacement license will be issued, with an expiration date no later

than that of the Agent's original license.

h)         If an Agent fails to notify the Director, in writing, of a transfer

before the change occurs, all owners, officers or other responsible persons

named in the application for an Agent's license shall remain liable to the Director

for all Lottery game tickets and proceeds held by the Agent.  This liability

extends to:

1)         Tickets issued to, or generated by, the Agent; and

2)         All proceeds from the sale of the tickets (less prizes paid

and/or commissions retained) to the date written notice is received by the Director

and a final settlement is conducted, or the date the Agent's license is revoked

or otherwise terminated by the Director, whichever occurs first.