Legal Considerations in Restaurant Sales Agreements: Protecting Your Interests

Legal Considerations in Restaurant Sales Agreements: Protecting Your Interests

 Legal Considerations in Restaurant Sales Agreements: Protecting Your Interests


Selling a restaurant is a significant undertaking that involves a multitude of legal considerations. From drafting a comprehensive sales agreement to addressing licensing and lease transfer issues, navigating the legal aspects of a restaurant sale is essential to protect your interests as a seller. In this blog post, Real Estate Law Corporation will provide you with a comprehensive overview of the crucial legal considerations that should be at the forefront of your mind when entering into a restaurant sales agreement.

Drafting the Restaurant Sales Agreement

1.1. Purchase Price and Payment Terms

One of the first legal considerations in a restaurant sale is the purchase price and the terms of payment. Ensure that the sales agreement clearly outlines the total purchase price, any down payment, and the schedule for the remaining payments. Detailing these terms prevents misunderstandings and disputes later in the process.

1.2. Assets Included in the Sale

Define precisely which assets are included in the sale. This should encompass all tangible assets like kitchen equipment, furniture, inventory, and any intangible assets like trademarks, recipes, or customer lists. Be comprehensive in your list to avoid disputes over what is or isn’t part of the sale.

Lease Transfer and Landlord Approval

2.1. Lease Assignment

If your restaurant operates from a leased space, transferring the lease to the buyer is critical. Ensure that your lease permits such a transfer and follow the lease assignment process outlined in the agreement.

2.2. Landlord Approval

Obtaining landlord approval is often a legal requirement for lease transfers. Ensure that the sales agreement outlines the steps involved in obtaining this approval and the responsibilities of both parties in the process.

Licensing and Permits

3.1. Transfer of Licenses

Restaurant sales often involve the transfer of various licenses and permits, including liquor licenses, health permits, and business licenses. The sales agreement should specify which licenses are being transferred, the timeline for the transfer, and any associated costs.

3.2. Compliance with Regulations

It’s crucial to ensure that the restaurant complies with all local, state, and federal regulations before the sale. The sales agreement should address the seller’s obligation to maintain compliance until the transfer is complete.

Contingencies and Due Diligence

4.1. Contingencies

The sales agreement should outline any contingencies that must be met before the sale can proceed. Common contingencies include obtaining financing, completing due diligence, and obtaining necessary approvals.

4.2. Due Diligence

Buyers typically conduct due diligence to assess the restaurant’s financial health and operational aspects. The sales agreement should stipulate the scope and timeline for due diligence and the consequences of any issues that arise during this process.

Post-Closing Considerations

5.1. Transition Period

Consider whether you will provide a transition period during which you assist the buyer in the restaurant’s operations and share your expertise. This can be beneficial for both parties and should be addressed in the sales agreement.

5.2. Dispute Resolution

Include provisions for dispute resolution in the sales agreement. This can specify how disputes will be resolved and may require mediation or arbitration before resorting to litigation.


Selling a restaurant is a complex transaction that involves a multitude of legal considerations. By carefully drafting a comprehensive sales agreement, addressing lease transfers, licensing issues, and due diligence, and planning for contingencies and post-closing transition, you can protect your interests and ensure a smooth and legally compliant restaurant sale. Engaging the services of experienced legal professionals, such as those at Real Estate Law Corporation, can provide invaluable guidance and expertise throughout the process, ensuring that your restaurant sale proceeds seamlessly and in accordance with the law.

Whether you’re a property owner, investor, or business owner, Real Estate Law Corporation™ is your trusted partner on the path to legal success. Contact us today to embark on a journey of exceptional legal support. Our team of seasoned attorneys brings decades of experience to every case, demonstrating a profound understanding of real estate law, transactions, litigation, business intricacies, and estate planning. With a proven record of success, our portfolio is adorned with numerous landmark cases that stand as a testament to our dedication, expertise, and commitment to achieving favorable outcomes for our clients.