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MIAMILAW1127
MIAMILAW1127, Attorney
Category: Business Law
Satisfied Customers: 755
Experience:  Founding Partner at Moises Law, P.A.
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We purchased a restaurant from an ex-owner. We kept the same

Customer Question

We purchased a restaurant from an ex-owner. We kept the same name and running it. However, when we want to sell it, the ex-owner wants us to change the name if we sell it off. We paid for the name the restaurant carries in the neighbourhood. If we change and sell it, why would the new buyer buy?
We have a sale agreement which mentions that we cannot transfer or lease the name if without their consent and agreed to pay 400/month for using their name. How can we now move forward? Are eternally stuck with to run the business? What are the otions? We were not given any franchisee documents or formal receipe etc. We just running with the same name and menu's.
Submitted: 1 year ago.
Category: Business Law
Expert:  MIAMILAW1127 replied 1 year ago.

Hello. Thank you for contacting me. I am a consultant here and I am looking forward to assisting you with your question. If at any point any of my answers aren’t clear please don’t hesitate to ask for clarification. Please be patient as I will be typing my responses to you from scratch. Also, I can only answer/address the questions you ask specifically based on the information your provide. Please try to provide as much information as possible so I can best assist you.

Please note: This is general information for educational purposes only and is not legal advice. No specific course of action is proposed herein, and no attorney-client relationship or privilege is formed by speaking to an expert on this site. By continuing, you confirm that you understand and agree to these terms.

According to what you're saying the agreement you signed says, you are not permitted to transfer the name without the consent of the original Seller. This is problematic for you because you can't sell the business with the name if the Seller doesn't consent.

It sounds like you are stuck if they are not consenting to the sale of the business along with the name. It seems like your options would be:

1. Keep the business.

2. Sell the business and not keep the name.

3. Figure out a way to get the original Seller to let you sell the business along with the name (maybe offer him/her some more money as consideration, etc.).

You're going to need to get the Seller on your side if you plan on selling the business with the name.

I hope this helps. Please use the SEND or REPLY button to keep chatting, or please RATE when finished. You may always ask follow ups at no charge after rating. Thank you.

Customer: replied 1 year ago.
Thank you for the reply. What kind of name changes can we make? Would it have to re-named completely or can we add a prefix/suffix etc? Ex: Old name is***** -- can we change it to The new Rinos or in similar mode.
Expert:  MIAMILAW1127 replied 1 year ago.

The type of name change (if you plan on keeping the same name as before in any part of the name) would come down to whether the Seller would allow it or not.

You would probably have to rename it completely to not have any of the Seller's say. From what you are saying, it seems that the Seller only has a say in the original name it had when he transferred it you. Any other name would be entirely up to you.

If you try to use a similar name, you may run into trouble with the Seller if you do so without his consent.

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