Under what circumstances can Lees Famous Recipe require a franchisee to reconstruct the restaurant premises in compliance with the then-current decor and specifications?
Lees_Famous_Recipe Franchise · 2025 FDDAnswer from 2025 FDD Document
If the Restaurant is damaged or destroyed by fire or any other casualty, you will, within thirty (30) days, initiate repairs or reconstruction, and thereafter in good faith and with due diligence continue (until completion) repairs or reconstruction, to restore the Restaurant premises to its original condition before the casualty. If, in our reasonable judgment, the damage or destruction is of a nature or to an extent that you can repair or reconstruct the premises of the Restaurant consistent with the then-current décor and specifications of a new Lee's Famous Recipe Restaurant without incurring substantial additional costs, we may require, by giving written notice, that you repair or reconstruct the Restaurant premises in compliance with the then-current decor and specifications.
Source: Item 22 — CONTRACTS (FDD pages 69–70)
What This Means (2025 FDD)
According to Lees Famous Recipe's 2025 Franchise Disclosure Document, Lees Famous Recipe can require a franchisee to reconstruct the restaurant premises to meet the current decor and specifications under specific conditions related to damage or destruction. If the restaurant is damaged or destroyed by fire or another casualty, the franchisee must begin repairs or reconstruction within 30 days to restore it to its original condition.
However, if Lees Famous Recipe reasonably judges that the damage is such that the franchisee can reconstruct the premises to match the decor and specifications of a new Lees Famous Recipe restaurant without incurring substantial additional costs, Lees Famous Recipe may require the franchisee to do so. This decision is made at the discretion of Lees Famous Recipe, and they must provide written notice to the franchisee.
This clause ensures that even in the event of unforeseen damage, Lees Famous Recipe maintains control over the brand's image and standards. For a prospective franchisee, this means being prepared to potentially invest in upgrades beyond simply restoring the restaurant to its previous state after a casualty, depending on the extent of the damage and Lees Famous Recipe's assessment.