@064 CHAP 1

        ÚÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄ¿
        ³    CHECKLIST FOR SIGNING A BUSINESS LEASE     ³
        ÀÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÙ

@Q      "If anything can go wrong it will.  Nature always
@Q       sides with the hidden flaw."  -- Murphy's Law
@Q
@Q      "Murphy was a optimist." -- O'Toole's Law

If you will need to lease space to operate your business
in, have you located a suitable place that is available to
you?  If so, here are a number of critical points you need
to consider before you sign a lease with the landlord:

    . The term of the lease.  Many small businesses tend to
      start off by either growing rapidly or quickly fold-
      ing.  Thus, except in a retail or service business,
      you will probably be better off leasing initially on
      a month-to-month basis or for as short a lease term
      as you can get, such as three or six months, even if
      the monthly rent is higher than for a longer lease.
      You will have enough financial problems already if
      your business fails, without being saddled with a
      long-term lease obligation.  If all goes well, and
      you need to expand into a larger facility, you won't
      be constrained by a long-term lease on a place you
      have outgrown.

    . Whether you can put up the kind of sign you must
      have, as large as you need, on the building.  A bus-
      iness like a restaurant can be devastated if the
      landlord doesn't permit a sign that is sufficiently
      visible to passersby.

    . Whether the landlord will permit you to make neces-
      sary improvements and alterations to the leased
      premises.

    . Whether the local health department, fire and police
      departments, air pollution control authorities and
      zoning rules will permit operation of your particular
      type of business at the location you have chosen.  If
      not, it is better to find out BEFORE you have signed
      the lease.

    . Whether your location is in a high crime area that
      will require expensive burglary insurance and secur-
      ity precautions.

    . Whether there is enough parking nearby or good public
      transit access for customers.

    . Whether the location is appropriate to the kind of
      business you will conduct.  There is usually no need
      to locate a manufacturing operation in a busy, high-
      traffic area.  On the other hand, retail businesses
      are usually heavily dependent on the number of people
      passing nearby on foot or by car.  For example, the
      owners of the Burger King chain reportedly select
      sites for their fast food restaurants by looking for
      locations that have at least 16,000 cars passing by
      each day at an average speed of about 30 miles per
      hour.

    . Whether the lease provides you an option to renew
      (and at what rental?) after the initial term expires.

    . Whether, if the lease is for more than just a few
      months, you have the right to sublease or assign the
      lease.  If so, under what conditions or restrictions?
      Are the restrictions reasonable ones that you can
      live with?  (Remember that a lease is a binding legal
      contract, and that if you agree to pay rent of $1,000
      a month for two years, you are on the hook for
      $24,000 unless you can sublease or assign the lease
      to someone else--which the lease, or the landlord,
      may make difficult or impossible to do.)