Kan. Admin. Regs. § 112-3-8

Current through Register Vol. 43, No. 18, May 2, 2024

Section 112-3-8 - Business structure and control of facility owner applicant or facility manager applicant

Each application for a facility owner license or a facility manager license shall contain the following information about the business structure and control of the applicant and any organization related to the applicant:

(a) The application shall state whether the applicant is a person, partnership, corporation, association, the state of Kansas or a political sub-division.

(b) The applicant shall list any commercial or noncommercial names used by the applicant, the business address or addresses and business telephone number or numbers. If the applicant is a corporation or limited partnership, the street, number, city and county of the corporation's registered office in this state and the name of the resident agent at that address shall be shown.

(c) The application shall include a copy of the applicant's tax returns for each of the five calendar years immediately preceding this application or all tax returns if the applicant has been organized for less than five years.

(d) The application shall include a copy of the balance sheets and profit and loss statements for each of the three fiscal years immediately preceding this application, or for the period of organization if less than three years. The financial information shall be given for the current fiscal year if the applicant:

(1) Has not completed a full fiscal year since the organization of the business; or

(2) acquires or is to acquire the majority of its assets from a predecessor within the current fiscal year. Balance sheets, profit and loss statements, and all other financial statements required shall be prepared, audited and certified by independent, certified public accountants in accordance with generally accepted accounting procedures and practices accepted on a consistent basis. Each report containing exceptions of a material nature shall not be certified.

(e) The application shall identify all loans made by the applicant in excess of one percent of net income. The statement shall include the name of the borrower, the amount of the loan, amount and type of collateral and terms for repayment and duration of the loan.

(f) The application shall briefly describe all pending legal proceedings to which the applicant, applicant's subsidiaries or related organizations are a party. The name of the court or agency in which the proceedings are pending, the date instituted and the principal parties involved shall be included.

(g) The application shall briefly describe all pending legal proceedings involving any of the property of the applicant, applicant's subsidiaries or related organizations. The name of the court or agency in which the proceedings are pending, the date instituted and the principal parties involved shall be included.

(h) If the applicant was organized within the past five years, the following information shall be stated:

(1) The names of the organizers or promoters with a voting interest or ownership of three percent or more;

(2) the nature and amount of anything of value received or to be received by the organizers or promoters directly or indirectly from the applicant; and

(3) the nature and amount of any assets, services or other consideration received or to be received by the applicant from the organizers or promoters. The applicant shall make the best effort to disclose the information required in subsection (h)(1).

(i) The application shall list any governmental, public, quasi-governmental or business organizations related to the applicant. The list shall state, for each related organization, the percentage of voting interest or other interest held, or any other basis of control held by the related organization.

(j) The application shall state whether the applicant is directly or indirectly controlled to any extent or in any manner by another individual or entity with a voting interest or ownership of three percent or more. The applicant shall make the best effort to disclose the information required.

(k) The application shall disclose the identity of any controlling entity with a voting interest or ownership of three percent or more and a description of the nature and extent of the control. The applicant shall make the best effort to disclose the information required. Documentation of the relationship shall be attached to this application.

(l) The application shall state whether the applicant, the director, officer, policy-making manager or principal stockholder or member:

(1) has owned an interest in any firm, partnership, association or corporation licensed by the commission; or

(2) is in the business of racing outside of the state of Kansas. An explanation of the circumstance of the interest or involvement shall be included.

(m) The application shall describe briefly and state the approximate value of any direct or indirect interest of any officer, director, policy-making manager, principal stockholder of the applicant organization or any associate of any of these persons, in any transactions during the last three years, or interest in any proposed transactions to which the applicant was or is to be a party;

(n) The application shall list all direct remuneration paid by the applicant and affiliated or related organizations during the applicant's last fiscal year to each partner, director, officer or policy-making manager of the applicant, naming each. As used in this paragraph, direct remuneration includes salary, retirement benefits, automobiles furnished, expenses reimbursed and all other sums paid for the benefit of the partner, officer, director, policy-making manager or other recipient;

(o) The application shall list the names, including any aliases or previous names, of each partner, director, officer or policy-making manager of the applicant, and each person chosen to become a partner, a director, an officer, or a policy-making manager with a voting interest or ownership of three percent or more. The applicant shall make the best effort to disclose the information required. Personal background disclosure forms provided by the commission shall be furnished by each person named. All positions and offices held by each person named by the applicant and each person's principal occupation during the past five years shall be listed by the applicant. The applicant shall disclose for each listed individual the nature and extent of any beneficial or ownership interest, including options or other voting powers, whether absolute, or contingent, that the individual holds in the applicant organization.

(p) If a nonindividual record or beneficial holder of an ownership or other voting interest of three percent or more in the applicant is identified in subsections (h), (j), and (o) above, the applicant shall disclose the information required by those paragraphs as to record or beneficial holders of any ownership or other voting interest of three percent or more in that nonindividual holder. The disclosure required by those paragraphs must be repeated in turn until all indirect individual record and beneficial holders of ownership or other voting interest in the applicant are so identified. The disclosure shall be brought about by the best efforts of the applicant.

(q) If the applicant is a corporation, the following information shall be attached to the applica-tion:

(1) The applicant's corporate structure;

(2) the year the corporation was organized;

(3) the state in which the corporation was organized;

(4) a certified copy of the applicant's articles of incorporation and bylaws. Any amendments to the articles of incorporation or bylaws shall be filed in a timely manner with the commission. A current copy of the applicant's articles of incorporation, bylaws and amendments shall be recorded at all times in the commission office;

(5) a statement whether, in the past five years, the applicant has been reorganized or reincorporated or whether it has filed restated articles of incorporation in the state of Kansas or in any other state. Documentation of such an action shall be attached to the application;

(6) a statement of the classes of capital stock authorized, the amount authorized and the amount outstanding as of fifteen days prior to the date of filing the application. If applicable, a statement of the amount of dividends paid to the stockholders during the five years immediately preceding the application or for the period of incorporation if a lesser time.

(7) a list of the name and address of each person or entity who owns, of record or beneficially, one or more shares of any class of capital stock or an option or conditional interest in the applicant. This information may be displayed in columnar forms providing for name and address, class of stock owned, type of ownership, whether of record or beneficial, amount owned, and percent of the class of stock;

(8) a brief description of the terms of any voting trust or power in which any of the capital stock is held and the name, address, class of stock and number of shares of stock for all stock held by that voting trust or power;

(9) a brief description of the terms of any proxy by which any of the capital stock is held, the holder of the proxy and the name, address, class of stock and number of shares of stock for all stock held by such proxy;

(10) a statement of any dividend rights, redemption, purchase, retirement, conversion or exchange provisions;

(11) a statement and an explanation if the rights of holders of stock affected by the exchange provisions may be modified otherwise than by a vote of a majority or more of the shares outstanding, voting as a class;

(12) a statement whether three percent or more of the applicant's assets, or three percent or more of any principal stockholders' stock, is encumbered by any long term debt;

(13) a list of names and addresses of all parties holding any evidences of indebtedness including any oral agreements from the applicant and the stockholders;

(14) copies of the agreements or other documents relating to evidences of indebtedness;

(15) if the applicant is applying for a facility owner or facility manager license for the first time:

(A) A statement whether the applicant has or proposes to enter into any loan transaction or has or will be executing any evidence of indebtedness of oral loan agreement shall be provided;

(B) a list of the names and addresses of any parties loaning or proposing to loan funds and those parties holding evidences of indebtedness relating to the applicant shall be provided;

(C) the applicant shall submit a statement whether three percent or more of the applicant's stock is or is proposed to be encumbered by any debt, whether as a result of loans to the applicant or loans to the stockholder, and a statement of the names and addresses of any lenders or proposed lenders. For each disclosure under this section, copies of any agreements or documents relating to the loan or encumbrance or a written summary of any oral transaction shall be attached; and

(16) a statement of good standing from the secretary of state.

(r) If the applicant is a partnership, the following information shall be included with the application;

(1) A statement whether the partnership is a general or limited partnership, and whether it is a domestic or foreign partnership;

(2) a statement indicating in what state and in what year the partnership was formed;

(3) a certified copy of the applicant's partnership agreement or a certified copy of the certificate of limited partnership;

(4) if any of the applicant's partners is a corporation, responses shall be submitted by each corporate partner to the requests appearing in subsection (q) above;

(5) a statement whether in the past five years the partnership has filed:

(A) A restated certificate of limited partnership; or

(B) any certificate of changes or amendments to the partnership certificate;

(6) a statement whether:

(A) Any certifcate has been cancelled;

(B) a judicial decree of amendment or cancellation has been issued; or

(C) a certificate of reinstatement has been issued. Documentation of any of these activities shall be attached to the application.

(7) a statement of any provisions for assignment of partnership interests, interim distributions or distributions upon withdrawal or dissolu-tion;

(8) a statement whether three percent or more of the applicant's assets are encumbered by any long term debt;

(9) a list of names and addresses of all parties holding any evidences of indebtedness or any oral agreements from the applicant;

(10) a copy of any agreements or other documents relating to any evidences of indebtedness;

(11) if the applicant is applying for a facility owner or facility manager license for the first time:

(A) A statement whether the applicant has or proposes to enter into any loan transaction or has or will be executing any evidence of indebtedness or oral loan agreement shall be provided;

(B) a list of names and addresses of any parties loaning or proposing to loan the funds and any parties holding evidences of indebtedness relating to the applicant shall be provided;

(C) a statement whether three percent or more of the applicant's stock is or is proposed to be encumbered by any debt, whether as a result of loans to the applicant or loans to the stockholder shall be provided;

(D) a list of the names and addresses of any lenders or proposed lenders shall be provided; and

(E) a copy of any agreement or document relating to the loan or encumbrance or a written summary of any oral transaction shall be provided; and

(12) a statement of good standing from the secretary of state shall be provided.

(s) This regulation shall take effect on and after October 1, 1988.

Kan. Admin. Regs. § 112-3-8

Authorized by K.S.A. 1987 Supp. 74-8804; implementing K.S.A. 1987 Supp. 74-8810 and 74-8815; effective, T-89-6, Jan. 21, 1988; effective Oct. 1, 1988.