Buying and Selling Restaurants

Tuesday, June 4, 2019

Choosing a Location for your Restaurant or Bar

There are many factors to consider when deciding where to lease space for a restaurant or bar- including the high cost of rent, the size of the space, and the accessibility of the space/location within a busy city.  Included in this consideration should be how evaluating any obstacles you might encounter in obtaining your liquor license, including the following: 

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Tuesday, February 7, 2017

Why Lawyers Kill Commercial Real Estate Deals and How to Spot a Bad Deal in Advance

Free Seminar:  Why Lawyers Kill Commercial Real Estate Deals and How to Spot a Bad Deal in Advance
When:  Wednesday, March 15, 2017 from 5:30pm – 7:00pm
Where:  NYC Small Business Solutions, 110 William Street, New York, NY (7th Floor Boardroom)
Seminar Description: Are you tired of spending countless hours showing a property and negotiating a deal, only to have lawyers get involved and kill the transaction?  How can this be avoided?  This seminar is designed to assist commercial real estate brokers identify problematic deal terms before their time is wasted.  The seminar will focus on:

  • Is your ‘non-binding’ letter of intent actually binding?
  • How to properly structure a letter of intent for various transactions (e.g. sale, lease, investment)
  • Identifying hidden lease expenses (i.e.

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Wednesday, August 17, 2016

You may be the owner of an illegal and accidental franchise and not even know it.

Beware:  If you own more than one restaurant which operates under the same name, you may have created an illegal and unintended franchise.

This sounds crazy, but it is actually very common and the consequences of creating an unintended franchise are substantial, serious, and include the possibility of both personal and criminal liability.  Many well-intentioned operators have tried to avoid the franchise tag by referring to their business relationships and partnerships as a “license,” or a “capital investment,” but the label placed on a relationship has little bearing on whether or not the relationship constitutes a franchise.

Would the same operators have pursued a different path if they had known that their mistake could result in the rescission of every one of their business transactions and the filing of criminal charges against them? It is a felony to sell a franchise without complying with both State and Federal law, and the respective agencies have the power to shut down your restaurants, freeze your bank accounts, order restitution, prevent an operator from opening new locations, impose huge penalties, award attorney’ fees to all injured parties, and rescind every one of the offender’s agreements under claim of fraud.  And, to top it off, claiming that they relied on the advice of their attorney will not help since franchise statutes impose strict liability, meaning that an owner’s intent or knowledge of the law (or lack thereof) is irrelevant.



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Thursday, August 11, 2016

Free Seminars: Legal Considerations when opening a bar or restaurant. Restaurant Management Boot Camp 2.0

When:   

Downtown Location:  September 13, 2016 from 5:30 p.m. to 8:30 p.m.
Uptown Location:  September 28, 2016 from 5:30 p.m. to 7:30 p.m.

Where:  

Downtown Location: 79 John St., 2nd Fl, New York, NY 10038
Uptown Location:  361 West 125th St., 2nd Fl, New York, NY 10027

Seminar Description:  An insider look at tips, tricks, and best practices to start your first restaurant in NYC, presented by Restaurant Attorney James D. DiPasquale.  To start and run a successful restaurant you must understand many different legal considerations which make operating in New York City, particularly unique. Whether you are a new or existing restaurant owner, this special follow-up to the Restaurant Management Boot Camp class will help you gain a deeper understanding of all of the basic requirements to get your business up and running.

-Forming a Corporation or Limited Liability Company (pros/cons of each)

-Partnership Considerations (The legalities of dealing with your business partners and investors)

-Finding  your restaurant space (Buying an existing restaurant vs. straight lease)

-Negotiating your Restaurant’s lease

-Applying for a Liquor License

-General discussion on permits needed (food service/cabaret/sidewalk café, etc.)

To Register:

For the Downtown seminar:  click HERE or paste the following link into your web browser: https://www.eventbrite.com/e/restaurant-management-bootcamp-20-lower-manhattan-91316-registration-27080444338

For the Uptown seminar, click HERE or paste the following link into your web browser: https://www.eventbrite.com/e/restaurant-management-bootcamp-20-upper-manhattan-92816-registration-26354368626?aff=ebapi


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Tuesday, August 26, 2014

Seminar Reminder: Restaurant Management Bootcamp 2.0 - Legal Considerations when Opening a Bar or Restaurant

This Thursday August 28, 2014 from 5:30 to 7:30 p.m. I’ll be giving a seminar in the Restaurant Management Bootcamp 2.0 Series that is hosted by NYC Small Business Solutions.  The Course Description is copied below:

Restaurant Management Bootcamp 2.0: Legal Considerations when Opening a Bar or Restaurant
An insider look at tips, tricks, and best practices to start your first restaurant in NYC, presented by Restaurant Attorney James D. DiPasquale.  To start and run a successful restaurant you must understand many different legal considerations which make operating in New York City, particularly unique.  Whether you are a new or existing restaurant owner, this special follow-up to the Restaurant Management Bootcamp class will help you gain a deeper understanding of all of the basic requirements to get your business up and running.



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Tuesday, June 24, 2014

Top 10 Considerations When Buying a Restaurant or Bar

1.  Buying the Assets vs. Buying the Company

Buying a business can be structured as an asset sale or as the purchase of an ownership interest in the legal entity that owns the restaurant. There are critical differences between these two options which come into when dealing with the State Liquor Authority, Sales Tax Department and a myriad of vendors.  Generally speaking, if you only buy the assets of a restaurant you will not be responsible for the prior owner’s liabilities unless you specifically agree to assume them.  This is true with the exception of the prior owner’s sales tax liability, if any, for which you must obtain a waiver from the tax department.

Despite this, sometimes it is in your best interest to buy the company itself, even though the seller’s liabilities might remain. This is particularly true when you intend to apply for a liquor license in a difficult community in New York City.   Only by reviewing all of the facts can you best determine how to structure your deal.

2.  What Assets are Included

Every restaurant and bar has a myriad of assets, both tangible and intangible. Some assets are owned outright while others are frequently leased (e.g. dishwashers, soda machines, POS systems).  Be sure to identify each and every asset you are acquiring in the purchase and which assets the Seller has no right to transfer.  If the Seller is leasing equipment, does he/she expect you to assume his lease agreement and if so, what are the terms of the lease.  No buyer wants to close on a purchase only to discover that the many of the assets have been removed from the restaurant because the seller was under a different impression as to what was  being sold.


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Monday, April 14, 2014

Celebrity Restaurant Lawsuit Illustrates the Complexities of Partnership Agreements

Celebrity Chef Gordon Ramsay Faces a Lawsuit by a Longtime Partner

Opening a bar or restaurant, or any business for that matter, in New York City has the potential to be expensive and risky, which can sometimes act as a deterrent for individuals who want to start a company of this kind on their own. Instead, partners and investors may be brought in to pool resources and talent. Restaurant partnership agreements vary greatly depending on each individual business, and disputes, misunderstandings and even potential cases of fraud can arise over such contracts. A recently filed lawsuit by an investor against celebrity chef Gordon Ramsay serves as a case in point.

Several years ago, Ramsay opened a Los Angeles restaurant called The Fat Cow with financial backing by Rowen Seibel, who had already worked with Ramsay on the opening of several other restaurants, including Gordon Ramsay Steak, Gordon Ramsay Pub & Grill and BurGR, all in Nevada. Seibel likely had little cause to anticipate a conflict, but quickly realized he wanted to pursue legal action.


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Thursday, November 21, 2013

New SEC Proposal Allows Restaurant Owners to Solicit Investors Through Crowdfunding

Crowdfunding is becoming an increasingly popular way for business owners to gain the financial backing they need to turn their concepts into realities. In recent years, websites like www.kickstarter.com have helped thousands of entrepreneurs obtain access to the funds they needed to get their projects off the ground. With the internet age upon us, the ability to reach people (and beg them for a few dollars) is easier than ever. However, would-be restaurateurs have not been as successful as other small business owners seeking financial backing in these arenas. Unlike other business owners, restaurant owners often need significant sums of money to open their doors. A donation of $10 in exchange for a coupon or a tee-shirt is not typically going to raise the amount of capital needed for a restaurant. But what if you, as a restaurant owner, could solicit true investors in exchange for a piece of your company?


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Friday, September 20, 2013

Seminar: Restaurant Management Bootcamp 2.0 - Legal Considerations

On Monday, September 23, 2013 from 3:00 to 5:00 p.m., I’ll be teaching the Restaurant Management Bootcamp 2.0 Series which is hosted by NYC Small Business Solutions.  The Course Description is copied below:

Restaurant Management Bootcamp 2.0: Legal Considerations of Opening a Bar or Restaurant in NYC.

An insider look at tips, tricks, and best practices to start your first restaurant in NYC, presented by Restaurant Attorney James D. DiPasquale.  To start and run a successful restaurant you must understand many different legal considerations which make operating in New York City, particularly unique.  Whether you are a new or existing restaurant owner, this special follow-up to the Restaurant Management Bootcamp class will help you gain a deeper understanding of all of the basic requirements to get your business up and running.


Read more . . .


Monday, December 17, 2012

Non-Compete Agreements – How Important Are They?

Take the famous Grimaldi’s Pizza, which was founded by Patsy Grimaldi in 1990. In 1998 Patsy retired and sold his business to Frank Ciolli for $500,000, who developed the business into 38 independent locations, the most famous of which remains in DUMBO. This past year the landlord refused to renew Ciolli’s lease agreement forcing him to move next door. Back into the picture and out of retirement steps Patsy, who leases his original space and now plans to open Julaiana’s, a nearly identical coal oven pizzeria. Legal battles ensue.


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Sunday, December 2, 2012

Starting a Business? Tax Department Publication Provides Critical Information

The following is courtesy of the New York State Division of Taxation and Finance.

If you're starting a new business or purchasing an existing one, there's a publication you might want to add to your reading list, the "Tax Guide for New Businesses" (Publication 20) from the New York State Department of Taxation and Finance.

This practical guide, freshly updated from cover to cover, provides basic information about New York State's tax laws and regulations for business of all sizes.

It highlights tax responsibilities related to sole proprietorships, partnerships, and corporations. It spells out filing requirements for employers and provides guidance on sales tax, the Metropolitan Commuter Transportation Mobility Tax, and other taxes such as the alcoholic beverage tax. It also provides information on New York City licenses, permits, and dozens of other tax-related topics.


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