How can the Lees Famous Recipe agreement be modified?

According to the 2025 Lees Famous Recipe Franchise Disclosure Document, the franchisor may modify the franchise agreement under certain conditions. Specifically, if a franchisee fails to comply with the Development Schedule or otherwise materially defaults under the Area Development Agreement, Lees Famous Recipe has the right to terminate or modify the franchisee's territorial rights, reduce or modify the size of the Development Area, or reduce the number of Restaurants that the franchisee is granted the right to develop under the agreement. This gives Lees Famous Recipe considerable latitude to adjust the development agreement based on the franchisee's performance and adherence to the agreed-upon terms.

This provision in the Area Development Agreement highlights the importance of meeting the development obligations outlined in the Development Schedule. A prospective franchisee should carefully review the Development Schedule and ensure they have the financial and operational capacity to meet these obligations. Failure to do so could result in a modification of the agreement that reduces the franchisee's territorial rights or the number of restaurants they are allowed to develop. This could significantly impact the franchisee's potential return on investment and overall business plan.

Furthermore, the franchisor retains the right to modify the System from time to time as deemed appropriate in its discretion. This includes changes, improvements, and further developments to the System. Franchisees must adhere strictly to the Operations Manual and other System standards and specifications, as these are essential to the operation of all Lees Famous Recipe Restaurants and the System as a whole. This underscores the need for franchisees to stay updated with any changes or modifications to the System and to implement them effectively in their restaurants. Prospective franchisees should inquire about the frequency and nature of such modifications and how they are communicated and implemented within the franchise network.