Question re master contract
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Ken:
I recently purchased your Burglar and Fire Alarm contracts. I have a customer with ten locations and we monitor the fire and burglar at each location and they would like to have an “Umbrella” contract instead of twenty contracts which we now have. I would list them as Customer Name and in the address part I would say see attached addendum. Then on the Addendum I would have some kind of language that would say this “Addendum” is attached to and made part of the service agreement between Alarm CO and Customer dated xxxx and all terms and conditions apply to the following locations. (Then list each location) I would have one for burglar and one for fire. Do you see any problem with doing this instead of having 20 individual contracts.
Thanks,
Rick M
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Answer
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Any of the Standard Form commercial contracts can serve as a master agreement so that with a rider or addendum you can add multiple location. If every location is going to have the same installation and charges, it's easy. But even if each installation is unique and the charges different, all you have to do is make those adjustments in the rider. If you're not sure then run it by an attorney.
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LLC or Corp question
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Ken,
I keep seeing that statements that a LLC is not the way to go as a alarm co business structure, but never a reason. Can you provide a few basic reasons that a LLC is so lacking.
" The first leg is a good business structure, like a Sub-S corporation, not LLC or even worse, sole prop"
Mike
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Answer
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I prefer the corporation with sub chapter S election. You corporation will be taxed like a partnership, which for simplicity means with pass through income and expenses; no separate corporate income tax. You will have limited liability - none for corporate contract debt and no personal liability for your employee's negligence. You will have shareholders, board of directors and officers.
The LLC is little more complicated to form, you have to publish in a newspaper and you must have an Operating Agreement. You will have a Managing Member and limited liability as in a corporation.
Corporations have been around a lot longer and the rules and case law more established. Unless there is some technical reason for the LLC I'd stick with the sub chapter s corporation.
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insurance carriers
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Hello Ken,
Thanks for the information below.
You specifically mentioned insurance carriers that are most familiar with our industry.
Can you provide a couple of companies that I can contact for a quote?
Thanks,
Vince Raia
EMC Security
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Answer
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I like Sarrg [Security America Risk Retention Group]; First Mercury; Scottsdale. In that order.
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Scanning question
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Mr. Kirschenbaum:
I have a legal question regarding shredding contracts after they have been scanned.
1. We have scanned the front side of all of our contracts and we also maintain the original paper copy. We did not scan the back of the contract.
2.Is it neccessary to go back and scan the back side of the document that contains the legal language?
3.Can we scan the legal language for each revision of the contracts to serve as a master for the back of the contract in lieu of going back to scan in every contract?
4.Once the contract is scanned can we destroy the orginal?
Thank you for your help in this matter and we are happy to pay for your services.
Respectfully,
Ikie
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Answer
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Better idea to scan entire contract. Not great idea to have a "master" back page because no one will be able to testify if changes were made to that page. You don't need to retain a paper copy once you have scanned the entire contract.
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plug for SIAC
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Dear Ken:
I know that you don't need confirmation on just how relevant your blog is but I am going to give it to you anyway.
First, SIAC would like to thank you for your support of our mission. I'm sure you get many replies that don't get published but you always seem to publish our comments and we appreciate that more than you can know.
This response from me ran early this week and the requests for more information on the training program for customers received 17 replies asking for the materials on the day the comment ran in your blog! This material has been featured in articles in our national trade publications with good results, but nothing like this.
I truly believe that as an industry we must develop effective end user training if we are ever to really put the false dispatch issue to bed. This is why I developed the materials in the first place.
I can only imagine how busy you are, and how valuable your time is, but I have attached the materials for your edification should be interested. If you have the opportunity to promote it we would be further in your debt. I should mention that the tip sheets come from the alarm abusers schools that were jointly developed by law enforcement and SIAC. These classes are over 90% effective in correcting the behavior of those who are the worst abusers, and even more incredible is the fact that the training is not equipment specific.
Again, we are not asking for anything more than a plug when the question of user training comes up.
I continue to hope that our paths will cross and I will have the opportunity to thank you personally for your support of SIAC and our mission.
Respectfully
Ron Walters, SIAC
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Response
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Those interested in the training material should contact Ron at ron@siacinc.org www.siacinc.org