KEN KIRSCHENBAUM, ESQ
ALARM - SECURITY INDUSTRY LEGAL EMAIL NEWSLETTER / THE ALARM EXCHANGE
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Can you use Hikvision with non-government jobs / webinar sign-up
November 8, 2021
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Register for tomorrow's webinar; see details below.  Register here: https://attendee.gotowebinar.com/register/8348669174055938571
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Can you use Hikvision with non-government jobs
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Ken
          We’ve received a letter from a customer who is apparently receiving funding from the Department of the Interior raising an NDAA compliance issue. This customer had HIKvision camera equipment installed by us years ago and was upgraded recently. The installation was fully paid, and the approving manager was aware of the equipment manufacturer prior to approving the installation. We were aware of the NDAA compliance issue, but thought it was a decision made by each agency depending upon whether or not they received federal funding.
          Customer now states it can no longer pay us if we cannot certify we do not use any equipment for any job, federally funded or not, from the list of banned NDAA manufacturers. We have other camera lines, but so often entities make purchasing decisions based on price, so we have kept the low cost HIK line available, thinking we would not use it on federal projects.
          Now this state agency is asking for certification of compliance. As we see it, we have two choices. Immediately stop selling HIK, and as existing client systems require repair or upgrade, use an NDAA compliant line, and then we can truthfully answer No to all questions. Or, continue to use/sell HIK products, state yes to all questions, and run the risk of being on the banned contractors list.
          Have other clients faced this issue, and is there any legal advice that can be provided?
anon
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Response
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          Let’s start with what manufacturers are banned by Federal law, The National Defense Authorization Act (NDAA):  Huawei and ZTE for telecommnications; Hytera, Hikvision, and Dahua for video surveillance.
          Now, to whom does the ban apply?  Government facilities and federally funded buildings or jobs.  State funded jobs and buildings are not affected, unless federal funding is involved. It appears that presently there is no law that prohibits the importing or use of the banned equipment for non-federally funded jobs and buildings.
          Obviously you should be careful not to violate this law.
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Next Webinar: 
Title:  Borrowing and finance option:  DealerAlly Program
When: November 9, 2021  12 pm ET
Presented by:  Tim Meekin,   President of DealerAlly, LLC
Hosted by:  Ken Kirschenbaum,Esq
Who should attend:  alarm owners, CEOs, CFOs, Sales Managers
Register here: https://attendee.gotowebinar.com/register/8348669174055938571
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Comment on what you need for shareholders agreement from article on October 28, 2021
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Ken
          Start with number 18. If you cannot agree on a procedure, then don't waste time on the first ten. They are moot. Dissolving is much more difficult and trying and expensive than forming.
Anon
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Response
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          For those who missed the article [and too lazy to go to the K&K website to read articles there, the checklist with 18 items is below.
          I don’t agree that number 18, dissolution, is the most important.  In fact, all of the items are important and shareholders, partners and limited partners should address each of the items in the agreement.  And, before I continue, I want to stress that having an agreement is essential for the well-being of the business and your piece of mind.  The agreement will help organize your business and the relationship with your fellow shareholders [I include partners here as well if the business is a partnership – which it shouldn’t be, and members if the business is a LLC].  There is less chance of dispute and litigation when there is an agreement dealing with the issues in dispute and the outcome is all but certain. 
          The best time to make an agreement is right now when you are good terms with your fellow shareholder(s).  Are we talking about a relative, a parent or sibling?  All the more reason for an agreement.  A best friend?  Even more reason for an agreement.
          It’s easy to reach an agreement when everyone is friendly and on the same page, hoping for success.  It’s when the unexpected happens, or sometimes just passage of time, that changes things, and things include people. 
          So yes, thinking about dissolution is important, but not most important, in fact I’d rather say, less important.  Nevertheless, it’s certainly one possible outcome and should be addressed.
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Checklist:
1  Name and address of the corporation and state of incorporation
2  Names and addresses of the stockholders
3  Percentage of shares each will own
4.  If any shareholder has contributed any capital or paid for their shares [that would include any accounts you transferred into the corp]
5  who owns the stock now and how many shares
6  type of alarm business or other business conducted
7  number of accounts - you can get valuation at https://www.kirschenbaumesq.com/page/what-is-my-alarm-company-worth
8  titles each will have - president etc
9  whether full time work is required, or not
10  respective compensation package
11  what happens if shareholder gets disabled
12  what happens if shareholder dies
13  what happens if shareholder wants to stop working - does he have to sell too
14  what happens if shareholder wants to sell during his lifetime
15  what is buy out formula in event of disability, death, wanting to sell during lifetime
16  what is payout schedule
17  can shareholder be required to give up employment with corp and be required to sell shares, and at what price and payout
18  what is dissolution procedure and who is in charge
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To order up to date Standard Form Alarm /  Security / Fire and related Agreementsclick here:  www.alarmcontracts.com
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CONCIERGE LAWYER SERVICE PROGRAM FOR THE ALARM INDUSTRY - New benefit just added - worth $75 per month - legal form letter sent to delinquent account on Kirschenbaum letterhead
You can check out the program and sign up here: https://www.kirschenbaumesq.com/page/concierge or contact our Program Coordinator Stacy Spector, Esq at 516 747 6700 x 304.
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Ken Kirschenbaum,Esq
Kirschenbaum & Kirschenbaum PC
Attorneys at Law
200 Garden City Plaza
Garden City, NY 11530
516 747 6700 x 301
ken@kirschenbaumesq.com
www.KirschenbaumEsq.com