Legal Question in Business Law in California

Re: Security agreement for business lease transfer

Making sure the buyer has assets and a proper agreement.

JOEL SELIK

Attorney at Law

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Re: Security agreement for business lease transfer

You will need a novation with the landlord. If the new tenant is of equal financial strengh, you may be able to negotiate this with an attorney.

Re: Security agreement for business lease transfer

You personally cannot do anything to protect yourself because it will take an attorney who has expertise in the business area to do this for you. Basically you're at the mercy of the person to whom you're selling the business. If they default you'll ever guaranteed the rant. You must have a business agreement with the person to whom you're selling the business itself. There are many clauses which could be contained within the agreement that is the best protection you can get. More importantly, he should take a security interest in the business which is being sold which will be transferred subject to all of the terms and conditions of the main agreement being complied with. That being payment in full to yield for the business as well as the initial lease term being complied with in full as to all terms and conditions not just the payment of monies. You should likewise make sure that the landlord gives you a notice of any default in a timely manner. If the landlord modifies any terms or conditions of the original lease you should be notified of those immediately. Basically, what I say you I am talking about your attorney and you but not you personally doing all of this since I have found that individuals do not have the expertise, sophistication and knowledge necessary to cover all the bases in protecting their own interests. Basically if the guy goes bankrupt though all bets are off and you will fully be responsible.I have been practicing law in the San Francisco Bay area for approximately 35 years and expert in the area in the category in which your question is placed. I feel I can help you in this matter and if you wish to consult with me please contact me at 925-945- 6000.