What is the 'Expiration of Development Period' as defined in the Lees Famous Recipe Area Development Agreement for Lees Famous Recipe?
Lees_Famous_Recipe Franchise · 2025 FDDAnswer from 2025 FDD Document
This Agreement will commence as of the date it is fully executed and, unless earlier terminated by us, will expire on the earlier of: (i) the expiration date of the last Development Period that the final Restaurant is required to be opened and operating under the Development Schedule; or (ii) the date you actually open the last Restaurant that you are granted the right to open under this Agreement.
Upon expiration or termination of this Agreement for any reason, you must immediately cease to develop new Restaurants in the Development Area and we will be entitled to grant others the right to establish and operate Lee's Famous Recipe Restaurants in the Development Area.
Source: Item 23 — RECEIPTS (FDD pages 70–287)
What This Means (2025 FDD)
According to the 2025 Lees Famous Recipe Franchise Disclosure Document, the Area Development Agreement will expire on the earlier of two conditions: either the expiration date of the last Development Period when the final restaurant is required to be opened per the Development Schedule, or the date when the developer actually opens the last restaurant they were granted the right to open under the agreement.
This means that a developer's rights to develop new Lees Famous Recipe restaurants in a specific area will end either when the agreed-upon schedule concludes, or when all the restaurants they were authorized to open are actually operating. The development schedule itself is outlined in Exhibit B to the Development Agreement.
Upon the expiration or termination of the Area Development Agreement, the developer must immediately cease developing new restaurants in the designated area. Lees Famous Recipe then has the right to allow others to establish and operate restaurants in that development area. This underscores the importance of adhering to the development schedule to maintain the exclusive development rights granted in the agreement.