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License holders and the companies they qualify
September 17, 2019
License holders and the companies they qualify
            Most jurisdictions require alarm companies to have a license.  That license is actually a license held by a natural person.  This person has the qualifications required by the license and holds the license for the alarm company.  Like a driver’ license [or any other license], the license is not transferable.  I’ve seen buy-sell agreements actually include the alarm license as one of the assets to be sold and transferred.  [ugh, don’t get me started].  
            So somebody needs to hold the license for the business.  It can be the owner, an employee or someone else closely associated with the business. Strangers to the business cannot be the license holder.  Each license statute will spell out the relationship between the license holder and the business.
            A license holder naturally has an interest in preserving the license and would not want to do anything to put that license in jeopardy.  Typical penalties for violating the license laws are suspension or revocation of the license.  And businesses also have a vested interest in not violating license laws.  Not only can a business lose its license holder, but a business can be banned by the licensing agency from getting another license holder, in which event that business is out of business in that jurisdiction.
            As you know The Alarm Exchange has a category for License Holders and businesses looking for license holders who can qualify the business for a license.  This is not an open invitation to violate the licensing laws.  As I mentioned above, the licensing law will address the relationship between license qualifier and the business.  
            A license holder asked me to look over an agreement prepared by a company looking to engage the license holder.  The company refused to engage K&K for its Qualifier – License Holder Agreement and insisted on using its own counsel for that agreement.  The license qualifier asked me to review the agreement.  Here is the exact advice I gave the license holder:  “If the licensing agency sees this agreement you will lose your license.”    
            The “licensing” agreement was, perhaps, fine for a license agreement, but not for the purposes of licensing qualifiers in the alarm industry.  There was simply nothing right about the agreement, period.  
            You should care about your license; you don’t want to have it revoked and prosecuted criminally to boot.  If it’s your business you should make sure your agreement with the license holder is appropriate.  I’m sorry if your cousin Vinny will be insulted when you engage K&K for the agreement, he’s not an expert in alarm law.  
            The Qualifier – License Holder Agreement needs to be prepared for each separate jurisdiction, so you can’t buy an agreement to cover one state and use it for another state.  Sorry about that too.  And for the hard nosed out there, yes I do care about selling contracts, but I also care about you holding on to your license and your business [that way I can sell you more contracts]. 

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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