Renegotiating Chair Rentals Mid-Sale, Then Losing Time to Grief

The situation

Danielle had tried to sell her Petawawa physiotherapy practice once already before she came to our office. She and the buyer she had lined up, Sylvain, a veterinarian looking to diversify into a health-services holding, had used a generic share purchase template pulled from a legal-forms website, filled in the names and the price, and assumed that was most of the work. Within a week of circulating it, two of the three independent contractors who rented treatment rooms and equipment time from the practice told Danielle they were walking. The template said nothing about what happened to their chair-rental agreements on a change of ownership, and none of them were prepared to sign on with a new owner sight unseen, on terms nobody had explained to them.

That first attempt fell apart mostly because the practice's value was not really in its clinic space or its equipment. It was in the recurring rental income from those three contractors and the referral relationships they had each built over years. A share purchase transfers the corporation, and the corporation's contracts transfer with it in theory — but chair-rental agreements are personal arrangements built on trust between the contractor and whoever is running the front desk. A contractor who is not consulted, and who sees a new name on the lease with no explanation, will often just leave and set up somewhere else.

Danielle's practice was valued in the two-to-four million dollar range, reflecting steady contractor rental income on top of her own clinical billings, and Sylvain remained interested in buying it even after the first attempt collapsed — he simply wanted the chair-rental question solved properly before he would sign anything binding a second time. That meant going back to basics: renegotiating each rental arrangement individually, with the contractors' input, before the sale agreement was finalized rather than after.

By the time Danielle came to us, she was frustrated and worried the deal was slipping away entirely. Sylvain had given her a window of a few months before he would look elsewhere, and one of the three contractors, Dirk, was the practice's highest earner and the one most unsettled by how the first attempt had gone. He had not been rude about it, but he had made clear to Danielle that he would not sit through a second round of paperwork that treated his livelihood as an afterthought to someone else's transaction.

The legal problem

The core issue was that a share purchase agreement, on its own, does not automatically fix contractor relationships that depend on personal trust rather than pure legal entitlement. On a share purchase the corporation is the same legal person before and after, so its contracts continue to bind and benefit it — the chair-rental agreements included, at least on paper. What that continuity does not account for is a change-of-control clause: many contracts, leases and licences give the other side a right to be asked for consent, to renegotiate, or to terminate outright when ownership changes hands, and those clauses have to be found and dealt with before closing, not after. That is precisely what had gone wrong the first time: the contracts continued on paper, but two contractors exercised the notice-to-terminate clauses those same agreements contained, because nothing in the deal had addressed what they actually wanted to know, which was what their working arrangement would look like under a new owner.

Each chair-rental agreement needed individual attention. They differed in length, in how equipment costs were split, and in whether the contractor supplied their own client list or worked partly off referrals the practice generated. Dirk's agreement, the largest of the three, included a right to terminate on short notice if the practice changed hands without his consent being sought in advance — a clause Danielle had included years earlier at his request and had entirely forgotten was there. That clause alone explained why he had walked the first time: he was exercising a right he had, not reacting emotionally to a sale.

Partway through renegotiating the three agreements, Danielle's father became seriously ill and died within a matter of weeks. She stepped back from the practice for several weeks to manage the estate and grieve, and every timeline on the file moved. Sylvain's financing pre-approval had an expiry date, the two remaining contractors were waiting on renegotiated terms before they would commit to staying, and the deal risked stalling for reasons that had nothing to do with the legal work itself.

The legal problem, once the bereavement was accounted for, became twofold: fix the underlying chair-rental structure so it would survive a change of ownership, and rebuild the transaction timeline around a family emergency without losing the contractors' willingness to stay or Sylvain's financing window.

What we did

1. Reviewed all three chair-rental agreements individually before touching the purchase agreement. We read each one for termination rights, consent-to-assignment clauses, and revenue-split terms, because the first attempt had failed precisely by treating these as boilerplate. Dirk's short-notice termination right, triggered by an unconsented change of control, turned out to be the single clause that explained the collapse of the first sale attempt.
2. Negotiated amended chair-rental terms directly with each contractor, with Danielle present. Rather than presenting Sylvain as a fait accompli, we arranged short meetings where Sylvain could explain his plans for the practice and each contractor could raise concerns about scheduling, equipment, and referral splits. This gave the contractors a say before anything was signed, which is what had been missing the first time around.
3. Drafted consent-and-continuation agreements for each contractor, replacing the old termination-on-change-of-control clauses. Each contractor formally consented to the change in ownership and agreed to updated terms reflecting the renegotiation, converting what had been a walkout risk into a signed commitment to stay, conditional on the sale closing on the agreed terms. This gave Sylvain something no verbal reassurance could: an enforceable document each contractor had actually signed.
4. Paused the file formally when Danielle's father died, rather than letting deadlines lapse quietly. We contacted Sylvain's lawyer and the contractors directly to explain the bereavement and requested a defined extension on Sylvain's financing pre-approval and the contractors' interim terms, so nobody was left assuming the deal had gone cold or reading Danielle's silence as a change of heart about selling.
5. Rebuilt the closing timeline around Danielle's return, working backward from Sylvain's revised financing expiry. Once Danielle was ready to resume, we set a new closing date with enough buffer for final due diligence and document execution, and confirmed every contractor's consent-and-continuation agreement was signed and ready before that date was locked in, rather than assuming the earlier signatures still reflected everyone's current intentions.
6. Finalized the share purchase agreement with the contractor consents attached as closing conditions. Sylvain's obligation to close was made conditional on all three chair-rental consents being validly signed, which gave him the certainty he had asked for after the first collapse, and gave Danielle a structure that could not unravel the same way twice even if one contractor changed their mind at the last moment.
7. Coordinated the closing itself, including confirmation of the corporation's good standing and transfer of the shares. We handled the mechanics of the closing — resolutions, share transfer documents, and release of Danielle's personal guarantees on the practice's equipment leases — so the sale completed cleanly once every underlying condition was satisfied, leaving no loose personal liability behind for Danielle once ownership had changed hands.

The outcome

The sale closed roughly two months later than Danielle's original hope, but on terms that held. All three contractors, including Dirk, signed consent-and-continuation agreements and stayed on after the change of ownership, which meant Sylvain acquired a practice with its recurring rental income intact rather than a bare shell of equipment and a lease. Sylvain's financing pre-approval was extended once, on the strength of a clear explanation of the delay, and did not need to be renegotiated a second time.

Danielle received the full agreed purchase price with no reduction for the delay, and the bereavement in the middle of the file did not cost her anything financially — it cost time, which the deal structure was built to absorb rather than resist. Nobody involved treated the pause as a sign the deal was in trouble, because the extension requests were made formally and early rather than left to be discovered.

What made the difference between this attempt and the first was not a more aggressive negotiating position. It was slowing down enough to understand why the first sale had actually failed — a termination clause nobody had reread in years — before trying again. The renegotiated chair-rental terms became part of the sale's foundation rather than an afterthought, and the practice changed hands with the working relationships that generated most of its value still in place.

Dirk stayed on for the transition and, by his own account months later, ended up with a clearer working arrangement than he had ever had under Danielle, precisely because the renegotiation forced a conversation about scheduling and referral splits that neither he nor Danielle had ever gotten around to having in nine years of working together. What began as the clause that sank the first sale became, once it was actually read and rewritten, the thing both sides pointed to as evidence the second attempt had been done properly.

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