By Shauna Krause, President, Capitol Services, Inc.
While you can read all about contractor’s license rules on the internet, you can’t download expertise! That’s why we’re here to assist contractors in sorting it all out. Getting started I confirm the ‘idea’ suggested by our first inquiry. Next, when a family finds itself dealing with the loss of a loved one, especially a licensed contractor, there are some steps that must follow in order to keep the business alive…
Q: Our company needs to get a Nevada Contractor’s license. I downloaded all the forms about six months ago and never completed them because our audited financial statements are not strong enough to get the license. However, now that I’m looking at the forms in more detail, it mentions an Indemnification option. Is it possible for us to be Indemnified by our Parent company if their financials meet the requirements?
A: Yes, your idea is correct, there is an Indemnification option! You can have your Parent company Indemnify in order to qualify for the license. Keep in mind that your company will still need to provide your financial statement and the Nevada Board will use the combined financial statements in order to make a determination. If you choose the Indemnification option, your Parent company needs to complete the appropriate forms as well as a Corporate resolution authorizing this Indemnification.
Q: I have a situation I hope you can advise me on. My Father died on August 15th and was 100% owner of a small electrical company, a family business employing myself, my brother, a bookkeeper, and one union electrician. The Company is a C-corporation. My father was the Responsible Managing Officer (RMO), however I have recently filed an application to replace him.
I am the Treasurer and only remaining Officer of the company. I have hired an attorney and an independent business appraiser to value the company in order to sell it in a few years when I retire. I am looking for help to ensure that I am meeting all legal and ethical requirements for my duties as Corporate officer and CSLB contractor.
My questions are 1. How long can the company continue to operate under the C-corporation’s Contractors license? 2. What steps should I take at this time to make sure that I comply with the requirements of the Corporation? The Corporate records have not been updated for a while and I need to get them in order, in case the Company must be sold. 3. Should I make my brother an Officer? He hasn’t expressed any interest in the business side of the company, but can I assume the role of all corporate officers?
A: First of all, sorry to hear about the loss of your Father. Please remember I am not a legal advisor and am glad to hear you have hired professional help. It sounds as if you are taking all the right steps in order to continue your family business. You can continue to operate with the Corporation’s license as long as it is Active and in good standing with the Secretary of State. Transfer of ownership only affects a Contractor’s license if it’s an asset sale, in which case a new license number would be needed since it’s a new entity.
In order to update your Officers with the Secretary of State, you will need to file a new Statement of Information. It’s up to you whether you make your brother an Officer, but yes, one person can assume the role of all Corporate Officers. The Replacement of Qualifier application you submitted in order to replace your Dad as the RMO will automatically update the CSLB. Let us know if we can be of further assistance.
While knowledge is power, knowing where to go for the answers is half the battle. Get expert assistance immediately when you call 866-443-0657, email info@cutredtape.com, or write us at Capitol Services, Inc., 1225 8th St. Ste. 500, Sacramento, CA 95814. Research past columns at www.cutredtape.com.
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